Saving for Retirement with Anne Lester: Start Early and Automate Everything

Anne Lester


One of my favorite things about hosting the Love, your Money podcast is that I get to talk to people I look up to–like economist, media commentator, and author, Anne Lester.

Anne authored the book Your Best Financial Life, and is on a mission to help Americans from all walks of life achieve a safe and secure retirement.

She joined me on the podcast to talk about delaying gratification, saving for retirement, the power of compound interest, and much more. We had a fantastic conversation and I couldn’t stop thinking about the importance of Anne’s message:

It’s never too late to start saving.

I highly recommend that you listen to the full, 37-minute interview to get all the conversational context and goodness Anne shared. But if reading + summaries are more your thing, just keep scrolling! 👇

This article is based on excerpts from episode 226 of the Love, your Money podcast, Automating Your Savings To Secure Your Best Financial Life With Anne Lester. Listen to the full conversation here.

Table of Contents



To build meaningful wealth, you need to save, invest, and repeat.

When you’re young, time is an incredibly powerful tool–but you are also early in your earning years and likely feel you don’t have any money to save.

Anne wants to help young people understand the long-term impact of the decision to spend instead of developing a saving habit early, because the consequences are huge. 

Trade-offs in the moment can save so much financial heartache down the line. 

It’s a hard lesson to learn, especially because it means accepting that there might never be enough money to do everything you want to do at once. We are sold an image of success by the media that involves spending money you might not have to “look rich.” But financial success is not measured by the possessions you have or the vacations you take. 

Wealth is created by saving, not spending.

A lot of financial success is about rewiring your brain to like saving over spending. 

This kind of delayed gratification isn’t easy because it’s counterintuitive to our natural wiring. We’re human—and therefore, much more likely to seek out pleasure and avoid pain. But overcoming that impulse and sitting with the discomfort for the sake of an increased reward on the other side is key to building wealth.

The famous Stanford marshmallow experiment demonstrated this principle, proving that discipline and the ability to delay gratification are essential to finding success in pretty much every area of life.

Waiting to double your reward–whether that means getting two marshmallows instead of one or saving $5 million for retirement instead of $500,000–is not easy. 

For most people, just thinking about delaying gratification literally causes the pain part of their brain to light up, rather than experiencing the pleasure part that lights up when they get to do what they want right now

Overcoming that impulse towards immediate gratification requires changing the way you think about the benefits of your choice in the moment, and creating guardrails for yourself so that you don’t eat the marshmallow–or spend your money–just because you can’t not.

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Understand your money habits and make impulse control easier.

Some people seem naturally inclined towards saving, and some people–like Anne and myself!–are spenders. A love of nice things led both of us to reckon with how we were managing our finances.

Becoming aware of your money habits, and how they’re impacting your ability to save, is key to creating what Anne refers to as financial “guardrails.”

Just like guardrails on the thruway keep you from driving off the road, financial guardrails can help support you in staying on a particular financial track, particularly by reducing temptation in the moment and making impulse control easier.

>> Maybe it’s automating deductions from your paycheck so that money goes straight to savings + investments without you ever seeing it.

>> Maybe it’s setting your savings account up at an entirely different bank than your spending accounts, making it significantly harder for you to transfer money back out of it after you’ve saved it.

>> Maybe it’s creating a set-it-and-forget-it, short-term savings plan where you siphon off $500 every month for your next car/home improvement/splurge in a high-yield savings account that you literally never let yourself log into. POOF, in 3 years, you’ll be paying for that life upgrade in cash.

The important thing is that the financial guardrails you set up work for you. 

I’ve found that automation is the secret sauce of stress-free saving toward your financial goals.

Automating savings takes away the ongoing stress of financial decision-making, and reduces the friction in making things happen.

When you do, even if it amounts to starting by saving “just” 1% or 2% of your income now, it will add up over time. In a year or two you will have real money accruing that you can put to work.

I promise it will be more money than if you hadn’t started saving at all. 

Listen to our full conversation on the podcast

Learn more about the financial guardrails Anne set up to start a savings habit, the mental blocks she overcame along the way, and how she uses automation to stay on track for her retirement goals.



Plant your proverbial money tree, and watch it grow thanks to the magic of compound returns.

Once you’ve built a savings habit and strengthened your gratification-delaying muscles, it’s time to take things one step further:

You must invest your money so that it outpaces inflation.

Anne explains that if you keep your money tucked away in a savings account instead of investing it–even a high-yield account that theoretically pays more than inflation–you’re going to lose money in the long run.

The power of time and investing early is compound returns.

Anne gave us an in-the-moment example: At a return of 7%, your money is going to double every ten years. That means $100 saved in your 20’s is going to be $200 in your 30’s, $400 in your 40’s, $800 in your 50’s, and $1,600 in your 60’s. 

If you have a regular savings habit and invest that money, just imagine how much that money will grow… and it will all happen automatically. 

It’s automatic money magic!

Over the course of Anne’s career, she has witnessed a lot of young people put off investing until their higher earning years, thinking it will be easier to save when there’s more money to go around. 

But she points out that’s a dangerous way of thinking–especially for your future self–because it will leave you playing financial catch-up and you’ll miss out on all those years of compounding interest. 

Even if you aren’t able to save and invest much, it’s about starting to build the habit. Then, as your earnings increase, you can increase your contributions instead of getting started from scratch. 

Start where you are, save at your pace, and remember: If you haven’t started saving yet, the best time to start is today.

On the Love, Your Money podcast: Investing Strategies for Women

Listen to this episode for more on the magic of compound interest, evidence-based investing in the stock market, portfolio diversification, and more.



It’s never too late to start saving–and the only wrong choice is to not start at all.

A recurring theme of our conversation was procrastination when it comes to saving and investing.

When I meet people at the beginning of our wealth management partnership, I’m always surprised to see such large cash balances sitting around. It feels like such a wasted opportunity! 

Their procrastination is understandable; the reality is that most people delay investing because they don’t know what to do with the money once they have it saved. 

There is a lack of financial education–especially when it comes to women investing in the stock market–and the fear of making the “wrong” choice keeps many people from getting started.

This is exactly what happened to Anne, and remember–it was her job to manage $125 billion of other people’s retirement money.

Even though she managed investments professionally, when it came to her personal financial decisions, Anne struggled with the same issues as everyone else. She would receive bonuses or company stock, then waffle about the best time to sell, invest, or reinvest. 

Her indecision led to procrastination—which led to lost money.

Eventually, Anne learned that she had to be mechanical about how she managed her savings and investments. The amount of emotional energy and mental space it took to constantly make those financial decisions–never mind the lost market returns from being on the sidelines–was not a good use of her time or resources. 

The solution? Eliminate recurring decisions and overcome procrastination by automating everything.

Make the process methodical, then set it and forget it. If you work with a financial advisor, hand it off and let them take care of it.

There is rarely going to be a moment that feels good when it comes to buying and selling stocks or changing the organization of your portfolio, so get the responsibility out of your hands. Use that time to do something meaningful or fun!

The time spent wondering what to do will end up costing you more time, money, and energy than if you had just started and put those assets to work.

Are you making the most of your assets and putting them to work for you?

At Hendershott Wealth Management, we partner with many people who work in Silicon Valley and receive stock as part of their compensation. We see a lot of “should or shouldn’t I” when clients think about managing those assets. Maybe you can relate?

We can help you break free from indecision and make the most of all your assets:
Book a call with our team of expert financial advisors today.



Opt for consistency, not genius.

In spite of managing retirement investments professionally, there was a time that Anne did not have a plan for her own retirement.

There’s a difference between saving for retirement by making contributions, and actively planning what to do with those savings.

It wasn’t until the birth of her second child that Anne started to take retirement planning seriously. In the process of wrangling the numbers, she found herself facing a series of questions that ended up forcing her to face reality:

  • How much money do you think you need for retirement?
  • How much are you spending now?
  • How can you outpace inflation between now and when you retire?

As she found herself answering “I don’t know” over and over, Anne realized that she had no idea how to approach her own retirement planning. 

She was only saving about 5% at the time, which was not enough, so she did what any reasonable and rational human would: shut her computer off, did the dishes, and didn’t think about it for a couple of years.

🛑 Before you do the same: Get our comprehensive list of questions to ask (and answer) to determine how much you need to retire + live the life you want.

Fast forward to a few years later, and Anne’s work led her to learn more about behavioral economics and research how people save. This helped her connect the dots between her actions and the results she was getting on a personal level. 

When she had an intellectual understanding of the problem at hand, she was able to find solutions.

All of the guardrails that were being built into the 401(k) system–like automatic enrollment, automatic increases to contributions, automatic investing–could also be implemented in the way Anne managed her own finances.

She learned how to rein in her impulse control, sit with the discomfort of not doing, and took the stress-inducing decision making out of her own hands. As soon as her stock vested, she would sell. As soon as she got money, she invested it without thinking.

She didn’t have to get clever each time a new situation arose; she could follow her own rules and opt for consistency, instead.

Do you have a plan (and strategy!) for your retirement?

If you do, great! If you don’t yet, that’s okay too! You’re here reading this article, so you’re already heading in the right direction.

Take the next step by booking a complementary call with our team! We’ll help you take stock of where you are today, then set you up with the resources and support you need to keep going–whether that’s with us, or somewhere else.

No matter what the next step is in your financial journey, we want to help you get there.



Automate, automate, automate your savings and investments.

A few years ago, Anne wrote a piece that cemented her name in my brain about the migration of American savings from pension plans to 401(k) plans. 

Because contributions to a 401(k) are invested in various assets, it means they are also exposed to market risk; if stocks dip, your retirement savings do, too. It can also be difficult to find a job where your employer offers 401(k) contributions. 

Given these considerations, I asked Anne if she had any recommendations for how people can eliminate risk when it comes to some of these variables and create more security for their retirement.

Anne acknowledges that about a third of Americans who work for an employer do not have workplace savings today–and anybody who’s working for themselves isn’t going to have a 401(k) plan unless they set up a Solo 401(k) or an account like it.

It’s up to you to set yourself up for a secure retirement.

For many, that takes the form of setting up an IRA. You can set up an IRA at any name brand financial institution, whether it’s a bank, mutual fund company, or online brokerage platform. Sign up for monthly contributions, and then… automate it!

After setting up that automatic savings, the next step is to automate your investing because leaving it in cash in the account won’t do much for you. 

In the name of simplicity, Anne recommends target date funds for retirees because you pick the fund that corresponds with the age you want to retire, and then you don’t have to think about it again. You can check in on your numbers as retirement approaches, but for the first few decades you can let your savings accumulate in the background.

At HWM, we appreciate the simplicity of the target date fund option. However, if we’re working for you, we’re going to automate your investing into a multi-fund allocation that gives you broad and low-cost exposure to publicly-traded companies around the world.

💸 Learn more about our Retirement Planning Services

Bottom line: by automating your savings and investments, you get to step away from the stress associated with decision-making.

The fear of making the wrong decision will stop you from making any decision at all… which is the only wrong decision. Every decision beyond that is a version of a better decision.



Get your money in the game in your 30s, 40s, 50s and beyond.

At Hendershott Wealth Management, we’ve worked with many clients in their 30s and 40s who are terrified that they’ve waited too long to start saving. We assure them that it’s never too late–and Anne agrees. 

When I asked what she would say to these folks, the response was the same as ours:

It’s never too late to improve your finances.

No matter who you are, you can do one thing today that will improve your finances tomorrow. 


The longer you wait, the more you’ll have to course correct later.

We are big believers that there is always hope for better, and we are also big believers in accepting reality as it is. The reality of financial planning is that if you aren’t on track for your savings targets, you need to adjust your savings rate. That can happen now or it can happen later–but it has to happen. 

Once you’re in the habit of investing, the compound return is like magic because you don’t have to do anything to see your savings grow. But you need money in the game.

👏 It’s 👏 never 👏 too 👏 late.

The best choice you can make is to start saving now. Or if you’ve been sitting on savings, start investing now.

Begin accumulating that compound return, and with a little luck from the markets combined with some real discipline in your spending, you can set your future self up with a comfortable–and maybe even luxurious–retirement.

Maybe your retirement goals involve plenty of soaking up the sun in the sand with a bottomless sangria in hand. Maybe they involve jet setting around the world to visit people and places you love. Maybe you have no idea what retirement will look like because you’re trying to figure out how you’ll get there!

Whether you’re crystal clear or clarifying your vision for the future, we want to help you get there–and enjoy the trip along the way.
Find out if we’re the financial fairy godmothers who can help make your retirement dreams come true! .



1. Create guardrails for your spending as well as your savings.

When I was digging myself out of umpteen thousands of dollars of debt, I swapped all of my credit cards for debit cards. It really took the wind out my impulse spending sails…because I was only spending money I actually had.

Again, your guardrails are unique to you.

Maybe it’s automating deductions from your paycheck so that money goes straight to savings + investments without you ever seeing it.

Maybe it’s setting your savings account up at an entirely different bank than your spending accounts, making it significantly harder for you to transfer money back out of it after you’ve saved it.

Maybe it’s creating a set-it-and-forget-it, short-term savings plan where you siphon off $500 every month for your next car/home improvement/splurge in a high-yield savings account that you literally never let yourself log into. POOF, in 3 years, you’ll be paying for that life upgrade in cash.

2. Save your raises to prevent lifestyle creep as your earnings increase.

Anne recommends that people save 50% of their raises, but I’m a little more ruthless and encourage people to save 100% of their raises. Put your new best friend–automation–to work and transfer the “extra” money right into your savings.

When you’re younger, it can be hard to prioritize saving because it doesn’t feel like there’s enough money to go around. Then, when you start earning more money, you don’t have a savings habit and you’re inclined to reward yourself after years of feeling deprived.

This lifestyle creep ends up getting a lot of people into trouble by the time retirement rolls around!

Avoid the creep, and make a proactive plan to put your money to work. Remember: You will get to enjoy the fruits of your labor–just not now.

3. Automate everything.

I follow the Profit First methodology in my business, and it spills over into my personal life. I use multiple accounts and automation to manage my own money–and when I’m working with the accounts of my high net worth clients.

Automation relieves the pressure of having to make more decisions, and doesn’t allow for procrastination.

4. Understand your money to set realistic financial goals.

When you don’t know what you’re working toward, it can be hard to put concrete goals into place. 

Think about what you’re working toward—what do you want retirement to look like?—and then consider how your current money habits and actions are supporting those goals.

Now, with all that in mind, rework your financial goals, and align your actions to support them.

5. Find a reliable financial advisor and don’t be afraid to ask questions.

Not everyone loves nerding out about saving, investing, and retirement accounts as much as Anne and I do–but that’s what we’re here for.

Book an initial call with my team and me here at Hendershott Wealth Management, where in 20 minutes, we’ll learn a little about you, understand why you’re reaching out to a financial advisor now, and gain a high-level summary of your current financial picture and goals.

All three steps of our discovery process are complimentary. All you need to do is show up, share, and ask q’s, and we’ll help guide you to the next right step.


If you take one thing away from this conversation, I hope it’s this: 

It’s never too late to start saving, and now is the perfect time to do your future self a favor.

Begin today. Listen to the full conversation between Anne Lester and me, start answering questions about your own retirement, and book a call when you’re ready to put some plans into action.

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