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Mitch in $ Financial Freedom Chasers,

What is the entry criteria to begin investing?

This is a question many people have, but very few know the answer to. The truth is, you're never too young nor too old to begin saving for retirement. Age is not a factor in this equation. What truly matters is how much debt you currently have. It makes little sense to begin socking away money for retirement when you still have credit card debt, car payments, and student loans hovering over your shoulders. Think about it this way, the conventional wisdom states that retirement should consist primarily of bonds, and it is very rare will you ever find gains you earn from bonds to be higher than the interests you are paying on your debt, except in very rare situations involving mortgage payments. Nevertheless, the right time to begin investing for retirement is only when you have finished paying off all of your debt.

Now for the exceptions to this rule:

You may sock away money for retirement if you plan on putting them into Roth IRA's. What are Roth IRA's you ask? If you make below a certain amount of annual income, you are allowed to put away around $5500 a year towards your retirement. This money will not be taxed when you withdraw them during retirement, thus making this a good option. However, if you have debt that is costing you 6% or higher in annual interest, then it would be wise to pay that off first.

Another exception to this rule is if your employer matches your contribution. Think about it, you are earning free money by putting away money for retirement. Once again, think about the pros and cons first. Do you really want to put away that extra $1000 per month for retirement when it could be paying off your credit card debt?

Finally, if you are adventurous and decide to invest in real estate (more risk) rather than bonds, it could also be a good idea to invest for retirement over paying off debt first.

But if you have no clue about what you are doing, 9 out of 10 times - Paying off debt prior to investing for retirement is always a better option.