Retirement: at 40 you are at a crossroads.

The video is in Italian. The article below sums up what was said.

October is financial education month in Italy, and the episode started from a sentence almost everyone has said at least once: «I'll think about retirement later». Stefano's answer was simple. Not deciding is also a decision, and it has a cost.

Putting it off is already a choice

At 40 you are roughly halfway through your working life. Retirement is 25 to 27 years away: there is still time, though not much. And time is the strongest lever you have.

«Not making a decision at forty, or earlier, is already a financial and retirement choice. Choosing to do nothing has an impact. It has a cost.»

Meanwhile the retirement age keeps moving. In Italy it is 67 today, and from 2027 it goes up by one month. Low birth rates and patchy careers weigh on it: irregular contributions mean less certain pensions. You can't control any of that. You can control your own finances.

What ten years are worth

Stefano gave the example of two people who put aside the same amount every month. We ran the numbers with his figures: 250 euros a month and an assumed return of 4% a year, up to age 67.

Who	Pays in	At 67 has about
Starts at 40	€81,000	€145,000
Starts at 50	€51,000	€73,000

The person who starts at 50 pays in 30,000 euros less and ends up with half the capital. Compound interest makes the difference, and it needs years to work. Start late and you have to put aside far more each month to reach the same point.

Illustrative calculation: monthly payments of 250 euros, compounded monthly at 4% a year, from age 40 and from age 50 up to 67. The 4% is an assumption: real returns change from year to year, can be negative and are not guaranteed.

Step one: know how much you will need

«I would stop seeing retirement as a hope, and start seeing it as a project to build.»

The first concrete step is a projection on the website of INPS, the Italian state pension agency (or your own country's pension service). It estimates the pension you will get. It is based on today's numbers, but it shows you where you start from.

Then compare that estimate with what you need to live. Stefano's example: today you live on 2,000 euros a month and your estimated pension is 1,200. You build those missing 800 euros yourself, over the years ahead.

Three pillars: income, savings, investment

1. Income. First you need earning capacity: money that comes in regularly.
2. Savings. Your income has to leave something over, and that is not a given: you can earn well and spend it all. Often it is enough to cancel the subscriptions you don't use and spend better, with the same lifestyle.
3. Investment. Only then does investing make sense. On the show Stefano mentioned pension funds and ETF portfolios built around your own risk profile.

Automate it, like a subscription

Your mind tries to avoid effort. If you have to decide every month how much to put aside, sooner or later you skip a month, then two. The payment has to go out on its own, like the subscription that gets charged without you noticing.

«It's like a diet: if it's too strict, you can't stick to it.»

A sustainable amount, even 100 or 150 euros a month, kept up for twenty years, takes you further than a big effort you drop after three months.

What if you are 20 or 30?

At the end the host said the topic matters to anyone over 30. Stefano pushed back: why not from 20? The earlier you start, the less you need to put aside each month to reach the same result.

Quotes are translated from Italian.

This article is for educational purposes only. It does not constitute financial advice or personalised recommendations. Every investment carries risks, including the possible loss of capital.