5 savings mistakes people make when building their financial life

By Kunyi Yang

The road to financial independence is not easy, and usually requires patience and diligence early on.

For young people still trying to establish their careers, focusing on retirement or saving for the future may not seem like a top priority. But making the wrong money moves early on can be costly.
Here are the five most common mistakes young adults are making when building their financial lives:

1. Waiting too long to start retirement saving

Planning for retirement is about finding a balance between putting money aside for later and having enough to pay for stuff now. But financial planners warn that the price of delaying can be high.

Thanks to compound interest, even modest amounts of savings will grow exponentially over longer stretches of time.

For example, someone who started saving $100 a month at age 25 could grow their money to around $150,000 by age 65, with a 5% rate of return. Meanwhile, if you wait until age 35 to start saving $100 per month, you’ll end up with just over half as much money at retirement age.

But most people aren’t starting early enough to take advantage of that compound interest factor.

In a from Natixis, 60% of respondents said they will have to work longer than anticipated in order to retire, and 40% said that “it will take a miracle” for them to be able to retire securely.

“Some people delay contributing to retirement because they still have student debts, but a bigger…