Dear Becky, I love the new tattoo. It is freakin' sweet. Yet, I'd like to talk to you about another major decision today: retirement planning.Dear Becky,

Congratulations on your recent decision to purchase a dragon tattoo! I must say that the artwork is fabulous. Since you obviously wanted to buy something that would last forever, I’m glad that you did it right. Lord knows that I’ve blown through loads of cash in my day as well. Being a cheapskate is not the way to go when you make one of these purchases. Well done.

On the other hand, I’d like to talk to you about making a financial decision that may also stick with you for the rest of your life. Bear with me here.. It might sound boring, but it’s called retirement planning.

I know, I know. It isn’t as exciting as getting inked, but making this decision at a young age is something that is going to stick with you for the rest of your life…just like your tattoo. Let me explain.

Retirement Planning: It’s Freakin’ Sweet

I’m sure it took you forevs to save up for that beautiful body ink. It takes work. It takes sacrifice. It takes a little financial planning. But, did you know that the younger you start saving for retirement, the better off you’ll be? For instance, you are 20 years old right now. If you saved just $20 every week and invested it until the time you were 65, you could have a buttload of cash to retire with. Over last 30 years, the stock market has had an average return of about 10%. The same can be said for the last 100 years. At that rate, you would have almost $750,000 saved in your retirement account. Even at a modest 8% average rate of return, you’d be looking at over $400,000. How is that for the power of small savings (and compound interest)?!?

I know it may not seem like a blast in a glass, but if you would have invested that $400 you spent on backstage passes to Fall Out Boy, you would have made about $29,500 by the time you were 65 – without ever adding another cent to the investment! So, was that crappy concert really worth $30,000?

Once you become a tat sporting cougar, you may consider putting your money into an annuity. Essentially, annuities are an insurance product that generate some interest and pay out a monthly stipend. They are a bit less volatile than investing in the market and usually require a lump sum to get started. That is why most people wait until they are reaching retirement age to check these out.

Sure, it really isn’t fair to expect you to invest all of your money. I understand that you need to live a little. By all means, spend some of your money on some kick-ass fun! Believe it or not, I was a kid once too.

Still, I wish I had taken my finances more seriously when I was your age. I just want you to know how much you could be costing your future self. It isn’t that I’m against spending. I’m not. However, I’d like to see you saving some, doing a little retirement planning, and still having fun. You can do it all.

So, I hope you don’t mind a little helpful advice from good ole Uncle Greg. I just want the best for you. You’ve got a bitchin’ tattoo and a ton of potential. Don’t waste it.

Lates,

Uncle Greg

P.S. – I do love the tat. It’s totally baller.