It's easy once you get started!


Provided by Mercer.

We all procrastinate – it's human nature! Most of the time, it's harmless – the world won't end if you don't vacuum the floor one week, or if you put off cleaning out your wardrobe. There's one type of procrastination that CAN be damaging though – and that's financial procrastination. Unfortunately, because most financial decisions (like making the decision to start saving seriously) are not much fun to make, it's easy to put them off – but the bottom line is that the sooner you start, the better off you'll be – and the longer you put it off, the bigger the hole you could be in later!

That's because time equals money. For example, take Jim, who starts investing $100 per month at age 25. He earns a solid 8% return every year, and by the time he is 65, he has accumulated a whopping $350,000* (approx). Susan, on the other hand, puts off starting her savings year after year in favour of spending the $100 per month on other things like shopping and entertainment. Before she knows it, she is 45, and realises that she'd really better start putting some money away. She saves $100 per month for 20 years, also earning 8% - but by the time she is 65, she has only saved $65,000* (approx) – not much to help with her retirement years!

The message here is that it's not how much you put away every month – it's how early you start that matters! That's why procrastinating is so harmful. The key is to get started – once you've been doing it for a few months and can see the money mounting up, it will give you incentive to keep going – and before you know it, your savings account will look very healthy indeed!

It's very easy to come up with excuses not to start saving. Maybe you think you don't earn enough, you're waiting for your partner to handle it, you don't know where to start – or you just can't be bothered! Whatever your excuse, it is just that – an excuse! There is bound to be a way around it, especially when you consider the long-term benefits – and consider how glad you will be when you do get to retirement age that you took that step to get started.

The good news is that procrastinating over saving money can end as soon as you want it to. Even if you are nearing retirement, any money you can save now will be money you will have then that you wouldn't have had otherwise. It's easy once you start – so start today!

*These figures are for illustration only and do not reflect any particular investment or include any fees or taxes.

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This information has been prepared by Mercer (N.Z.) Limited for general information only. The information does not take into account your personal objectives, financial situation or needs. Therefore, you should not act on this information if you have not considered the appropriateness of this information to your personal objectives, financial situation and needs. You should consult a financial adviser before making any investment decision.


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