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Dollars & Sense: Managing Money from Teens to Retirement

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We work hard, and we want to enjoy the fruits of our labor. The temptation can be strong to spend money on extravagancies for ourselves and others. But putting money aside for later means investing in our future, and it’s just smart.

The Federal Deposit Insurance Corporation has offered some money management advice that spans all age groups, beginning with teenagers:

Teens
Save money before you’re tempted to spend it. When you get cash for your birthday, from chores, or a job, put 10 percent in a savings account. Also, put spare change to use. When emptying your pockets at the end of the day, put some of the loose change in a jar or container. At the end of the month, put it all in a savings account at the bank.

Young Adults
Start saving now for long-term goals like a house, owning a business, or saving for retirement (it’s a long time off, but it’s never too early). Create a budget for yourself. It’s a good way to see where your money’s going, which can shape the way you spend it in the future. Get started building a good credit score by getting a credit card, spending wisely and paying it on time.

Newlyweds
Have a candid talk with each other about finances. Set short-term and long-term goals. Talk about buying a home. Work through a monthly budget of expenses. Discuss whether or not you’d like to have a joint bank account or keep your earnings separate.

Midlife
In this phase, and we’re talking late 30s to late 50s, you should focus on retirement and your child’s college expenses (if applicable). It’s important to determine how to maximize your income during your remaining working years, so that you’re well-positioned for retirement. Do this by contributing to an IRA and/or a 401(k). Explore ways to save money for your children. Use a 529 plan or other savings account.

After You Retire
Time to reap your reward: visit the places you’ve never seen, take up a new hobby, or spend more time with your loved ones. Being successful in retirement means you’ve got to make the most of your income and investments. Have your Social Security benefits, pension, and other income automatically deposited into your account each month. Consider a second career or working part time to boost your retirement income. Be careful with credit cards, and monitor your accounts closely.