The tradition of an Easter egg hunt runs as strong as ever in my family. It is fun to watch the kids get excited over something as simple as a hollow plastic “egg” filled with a piece or two of candy; a level of excitement rivaled only by the joy of opening presents at Christmas. This past Easter, as I watched my daughter Maddie go through the basket of eggs she gathered, I came to realize the Easter egg hunt can be a metaphor for one’s retirement savings journey.
When I was a child, Easter eggs only varied by the color of their plastic shell. Now the eggs come in a huge variety of colors and shapes. In Maddie’s basket there were eggs shaped like cars and trucks, frogs and rabbits, footballs and basketballs, and so on. Importantly, they were of similar size and held roughly the same amount of candy.
How is an Easter egg hunt similar to saving for retirement? Like Easter eggs, retirement investment options seem to come in all sorts of shapes and colors. The number and types of investments available for people to use for retirement saving is greater today than it has ever been. With the right guidance, this variety is a good thing.
You can also think of the candy in each Easter egg as the amount of retirement savings you put away each paycheck. Like the one to two pieces of candy in each Easter egg, these amounts will generally be the same relatively small amount each paycheck. Also like an Easter egg hunt, the real payoff comes when it comes time to gather your eggs and check the contents. The more eggs you gather, the bigger your haul.
What does this mean for retirement saving? I think that it means you should start saving as early as you can for sure, but if you have not started already, don’t hesitate to start now. The advantage of saving for retirement over hunting for Easter eggs is that you always know what the Retirement Bunny is putting in the eggs!
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