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Follow These Steps To Retire A Millionaire

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The world of finance can be confusing, and for many twenty-somethings, retirement seems forever away. Well it's not, and you should start saving money, like, yesterday.

Related: The Zero-Sum Budget Has You Spend All Your Money

Take It Day By Day

If your current income is less than desirable, have no fear—financial advisor David Bach writes in his book Smart Couples Finish Rich: "You don't need to have money to make money. You just need to make the right decisions — and act on them." To illustrate his savings model, he built a chart showing exactly how much you'd need to save daily, weekly, or monthly (depending on age) to retire with a comfortable savings of $1 million. Not every lifestyle requires $1 million, of course, but this retirement salary would allow you an approximate yearly salary of $40,000 over 30 years.

Related: How the 50/20/30 Rule Can Help You Budget

If the idea of setting up a 401(k) plan or an IRA is making you want to bury your head in the sand, here's some tangible encouragement: if you're 20 years old, you would only need to invest $2.00 a day into your 401(k) to reach $1 million by age 65. If you're 25, you'd need to save $3.57 a day (goodbye, daily latte). However, if you're a little late to the savings game, you'll need to save $20.55 a day at 40 years old, and $156.12 a day at 55 years old to meet a savings goal of $1 million. While Bach's calculations show the impact of building wealth over time, it's important to note that they rely on a 12 percent rate of return (fairly lofty), and he isn't taking the effects of taxes into account.

Related: The Money You Make Depends On The Sleep You Get

You Can Always Save Something

If these numbers are sounding unrealistic for your current financial situation, take a breath... then contribute what you can. Kristen Robinson, senior vice president of women and young investors for Fidelity Investments, tells Mental Floss: "If you can't save 15 percent, save what you can right now." The point here is to start saving as early as you can and as much as you can—even if that's only 1 percent of your earnings. Robinson recommends automating your 401(k) contributions to increase 1 percent each month. That way, she explains, "you don't have to rely on your memory or your motivation to increase your savings." If you were to contribute 1 percent, that would only cost someone with a $40,000 salary $33 a month. Doable, right? Just ditch the Starbucks and start dreaming of tropical vacations with Jimmy Buffet's "Margaritaville" on loop.

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Editors' Picks: The Most Helpful Videos About Saving Money

How To Save A Million Dollars In A Few Small Steps

Always contribute up to the company match.

7 Psychological Money Saving Tricks

1. Use cash instead of a debit or credit card. (It's more painful to hand over.)

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