AdobeStock_403658626-1For those of us still in young adulthood, it can seem like an accomplishment just to have a job, health insurance, and a diet that consists of more than Ramen noodles and pizza. Unfortunately, it happens to be a little more complicated than that. Maybe you’ve been saving into a 401(k) account (or other separate retirement plan) and maybe you haven’t; but either way, retirement is something everyone should be thinking about even in their 20s or 30s. I know, I know… you just got past the Ramen stage of life, but do you really want to have to eat that way again when you’re 70? Probably not. That’s not to say Gen Y hasn’t been doing a good job of saving for retirement: A Prudential survey out in December showed that of employees 21-29 who are eligible for company plans, 91 percent will participate if they're making more than $50,000 a year, while 70 percent participate if they're making less than $50,000 a year. Jim Keenehan says, “We are seeing this trend grow and we are seeing people save more,” based on his work performing employee retirement workshops with clients.There are a lot of things you are going to want to do in life and they all cost money: weddings, graduate school, and owning a home are all wonderful achievements, but they all have financial repercussions. It’s so easy to just carpe diem and not think about the long-term effects certain activities have on your financial future. In a recent survey by Ameriprise Financial, many respondents said that personal events “derailed” their ability to save, so it’s important to be aware of the cost certain milestones will have.

Student Loans

While everyone’s situation is different when it comes to paying for school, let’s assume we’re talking about the thousands of people who take out loans to finance their foray into higher education. In the U.S., total student loan debt has reached $1 trillion, as reported by the Consumer Financial Protection Bureau; So, paying for education would appear to be a very, very common issue. The one major way in which taking out student loans will impact your finances is incurring the cost to pay them back later, which usually takes many years. Taking on this burden has a lot to do with what sort of field you are in and how lucrative your post-grad job will be. All in all, the negative impact of student loans on your finances relies heavily on how responsible you are at managing them.

CEO of MoneyZen Wealth Management, Manisha Thakor points out, ““You are not doomed to a horrible financial future simply because you have a high amount of student loans.” There are statistics to back this up as well with reporting that 39% of those with more than $50,000 in debt have a credit score above 700. On the other hand though, it’s important to know how to prioritize paying these loans back versus retirement savings. Keenehan points out that saving for retirement should be prioritized over paying more (than the stated payment) of your loans off, IF your company offers a match. To put it bluntly, he says, “If you’re offered a match, and you’re not saving enough to receive the full amount that your company is offering, then you’re not making a very wise long-term decision.”

While retirement planning should be a priority along with paying back your loans, a delinquent student loan payment or worse, going into default, will have major consequences on your credit.

Getting Married

When someone pops the question, no one’s first thought is “How will this affect my finances?” Paying for the wedding alone is a serious endeavor, with the average wedding in the U.S. costing $28,427 in 2012, according to a survey released by wedding website Furthermore, the process of vowing to spend the rest of your life with someone else inherently also means spending retirement with them as well.

At the most basic level, marriage is a business transaction. I know, that’s so unromantic, but if you marry someone, your financial problems and successes become intertwined. Debt, credit scores, joint accounts, and so forth are all factors at play. If someone has a mountain of debt that is going to take years to pay off, it will certainly affect how you funnel money into other areas of life, such as retirement. So exchange credit reports and be honest about your finances beforehand to know any pitfalls to saving you may encounter in the future.

Everyone is different when it comes to their money. Maybe someone’s goal is to save every free cent for their retirement while another person’s goal is to blow your entire savings on that wedding day. Either way, your goals need to at least partially align. Talk about what type of retirement you envision and then consult a financial professional to gauge how much you need to be saving into a 401(k) or other account in order to meet those goals.

Buying a Home

This is a big one. Unless you’re Donald Trump, you’re probably not making long-term real estate investments on the regular so this is definitely an area where doing your homework is very important. Furthermore, with recovery from the recession still close at our heels, the “American dream” of home ownership is viewed as out of reach by many millennials. That’s not to say that plenty of people in this group aren’t buying property: A recent Pew survey states 34.3% of the millennial population have become homeowners. One of the biggest things that you need to consider when getting ready to purchase a home is how much the entire cost will detract from saving for your future. How much will you have to cut back in savings when you add up the cost of a down payment, mortgage, insurance, taxes, etc? If you foresee that buying a home will greatly reduce the amount you can put into retirement for the long haul, maybe it’s not the best option at the present moment.

Speaking of savings, having an emergency fund is also vital, especially if you’re looking to undertake the endeavor of home ownership. Experts say that at least 3-6 months of your monthly income should be in an accessible account in case you need it. If you see yourself dipping into that then, you’re probably not ready to buy. Keenehan advises, “It is critical to understand all of the costs it takes to buy a home, not just the down payment. And although the good old fashion rule of having 20% to put down has certainly been coming back in vogue lately, albeit this has a lot more to do with qualification standards tightening up, there are several other costs that can be required to get into the home of your dreams. If you haven’t mapped out all of these expenses and built a game plan to set these aside, then the best advice may be to simply keep saving. Don’t let emotion dictate a critical financial decision such as this one.”

Credit Card Debt

It’s pretty obvious that carrying credit card debt is generally bad, but just how bad is it in the grand scheme of things is not always as clear. To paint a picture for how much the average American is losing out on retirement savings because of debt, Investment News stated in 2010 that defined-contribution plan participants held about $9.2 trillion in savings plans, but also owed about $4.2 trillion in debt. Clearly, there’s a lot more savings to be had. All of the life events we already talked about, as well as many others, can contribute to someone taking on credit card debt.

It’s really easy for someone to feel like using credit cards is adding to their disposable income. Having credit is also a necessary evil if you want to do things like own a home one day, so there’s a few factors at play when one finds themselves in credit card debt. And not to scare you, but in a recent Fidelity survey, Gen Y is projected to have an income gap of 62% once they reach retirement. What that means exactly is if you first think far into the future, say to the age of around 65 and picture the type of lifestyle you’ve probably become accustomed to, then, take 62% away from that wonderful picture. That is maybe what you will be working with in retirement. Keenehan thinks about it this way: “If I have credit card debt and let’s say I am paying 19% interest, I should really pay that down first and foremost to minimize throwing extra dollars away in interest payments. However, if my employer-sponsored retirement plan is matching, for example 50% of every dollar I put in, then I am getting a 50% rate of return on my money just by contributing.”

So, long story short, find a balance between contributing to your retirement savings, especially if your company offers a match, AND paying off that pesky credit card debt.

In short, we all have certain life goals, which are inextricable from our finances. While younger people have been doing a better job of saving, our instinct as a whole is still to overspend and live beyond our means in many ways. Keenehan points out the cold hard truth that, “If you want to be successful in some of these things, you have to make some sacrifices.” While we certainly want young professionals to have fun and enjoy some of the perks of additional disposable income, the earlier you get started on saving for your future, the better off you are at age 60, 65, or 70 – and the result can be exponential.