The Startling Reality of Savings in America

According to CNBC, 70% of adults have less than $1,000 in their savings accounts. Let that sink in for a moment. That’s a startling statistic, and one that can often be avoided with proper planning and budgeting a consistent focus on saving money.

So, what is the best age to start saving money? While there is no one-size-fits-all answer, a good rule of thumb is to start saving as soon as you start earning. Whether it’s mowing lawns at 12, delivering pizzas at 16, or landing your first full-time job, paying yourself first is always a wise decision.

The Power of Early Saving Habits

Beyond the financial benefits, saving early fosters habits that can last a lifetime. Teaching children to save helps them develop discipline, patience, and responsibility—skills that will serve them well throughout their lives. It also instills the ability to live within their means, setting them up for a financially stable future.

One of the biggest advantages of saving early is the power of compound interest. Often referred to as “interest on interest,” compound interest allows savings to grow exponentially over time. When paired with time—the biggest advantage of starting young—the results can be substantial by the time retirement comes around.

The Impact of Time and Automation

Retirement savings are equally concerning, with about half of U.S. families having no retirement account savings, according to CNBC. Many young people put off saving for retirement, thinking they have plenty of time. However, the earlier you start, the greater the impact.

Consider this example from CNN Money: If you start saving at 25 by putting aside $3,000 annually in a tax-deferred retirement account for just 10 years, and then stop contributing altogether, your initial $30,000 investment could grow to over $338,000 by age 65 (assuming a 7% annual return). Conversely, if you wait until 35 and contribute $3,000 annually for 30 years, you will have personally saved $90,000, but your total savings would only reach about $303,000. The difference? Time and compound interest.

Automating savings is one of the easiest ways to stay on track. Workplace retirement plans make this effortless by automatically deducting contributions from your paycheck. The same principle applies to other savings and investment accounts—setting up automatic contributions ensures consistency and discipline. If you work with a financial planner, consider discussing automated investment contributions to further streamline your savings strategy.

The Key Takeaway: Start Now

The bottom line is simple: The more you save, the better. The earlier you start, the better. Don’t fall into the mindset of waiting until you earn more, get a raise, or pay off debt to begin saving. Teach your children the importance of saving their hard-earned money as early as possible. Start today—better yet, start yesterday.

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