This Is the Best Advice I Can Give Anyone Saving for Retirement

Let's face it -- saving for retirement can be a real pain. When you have numerous expenses to cover and a life you're trying to enjoy, it's not easy to set aside money you may not get to use for 30 or 40 years.

But saving for retirement is extremely important, because if you don't do it, you may be forced to live on Social Security alone down the line. The average retiree benefit today is just over $2,000 a month, which isn't a whole lot. If you bring savings into retirement, you'll have a way to supplement your Social Security.

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Now you'll hear a lot of advice when it comes to retirement savings -- invest in this stock over that one, choose this type of account, and so forth. But the best piece of advice I can give you has nothing to do with the specific stocks you add to your portfolio or the specific account you choose to save in. Rather, it has to do with your timing.

Starting early is key

When it comes to building retirement savings, the most powerful tool you have at your disposal is time. It's important to start funding your IRA, 401(k), or savings plan of choice at as young an age as possible so you're able to give your money the maximum amount of time to grow.

Let's say you're able to set aside $300 a month in a retirement account, and that throughout your career, that's the maximum your budget allows for. Let's also assume you're able to earn a yearly 8% return in your portfolio. That's a reasonable assumption since it's a bit below the stock market's average. Finally, let's assume you'll retire at 67, which is Social Security's full retirement age for anyone born in 1960 or later.

If you begin saving that $300 a month at age 37, giving yourself a 30-year investment window, you could end up with a nest egg worth about $408,000. And that's definitely a nice amount of money.

But watch what happens if you start funding your retirement account with $300 a month 10 years earlier. If you begin making those contributions at age 27, thereby extending your investment window to 40 years instead of just 30 years, you could end up with a nest egg worth almost $933,000.

Now you'll notice that starting to contribute to your retirement account 10 years earlier in this example means putting in an extra $36,000 in total ($300 x 12 months x 10 years). But that extra $36,000 could lead to an additional $525,000.

And the reason is that you're giving your money that much more time to grow. When you look at it that way, it seems like a no-brainer.

How to find the money for retirement savings

While it's easy to see the benefit of beginning to fund your nest egg at a young age, the challenge is finding the money. To that end, here are some strategies to employ:

• Budget carefully to avoid spending on needless expenses, and assess your spending regularly
• Work a side hustle for extra income
• Aim to snag your full 401(k) match each year
• Minimize at least one major recurring expense, like housing or your car payment

To be very clear, it's important to choose the right investments for your retirement savings. And it's also a good idea to save in a tax-advantaged account like an IRA or 401(k) plan.

But the most critical thing you can do on the road to building a retirement nest egg is start early. Those extra years of contributions could make an enormous difference down the line.

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