Why I'm NOT Saving for Retirement

Almost every PF blog I have ever read has discussed IRA's and other retirement options at length.  It's common wisdom that you need to be setting money aside every paycheck to go towards retirement.  However, I haven't started to save for retirement...yet.

Don't get me wrong, I'd really like to be saving for retirement!  I'd love to be following all of the wonderful PF advice available and I've been working towards it!  Since entering the world of personal finance I've definitely made progress (http://gradbudget.blogspot.com/2012/04/tracking-spending-and-net-worth.html) from my days of living paycheck-to-paycheck.  I even opened a separate account to hold my emergency fund! (http://gradbudget.blogspot.com/2012/04/separating-emergency-fund-from-other.html)

The only thing I haven't done is open up a retirement account.  I've learned quite a bit about the retirement accounts available and found that a Roth IRA is probably my best option.  I understand the power of compound interest especially with time on my side.  What I haven't figured out is how to balance retirement savings with my other financial goals.

When is it time to stop putting money into my emergency fund and start putting it towards retirement savings?  I have a reasonable stable income for the next (approximately) two years.  However, at the end of that time I'll be searching for a job.  Hopefully a job that will come with a nice sized paycheck and it's own retirement plans.  As a graduate student these are all things that I hope will come out of the years I've spent on my education... but I can't help think "what if?"

• What if I don't find a job right away?
• What if I don't have the background job hunters are looking for?
• What if another economic crisis hits right as I graduate and another round of hiring holds are placed on the universities I would most likely work at?
• What if I'm "over-educated" and can't get a job because I'm over-qualified?

These are all very big and very real (to me) what if's that make me want to have a nice sized emergency fund.  As a result, I keep putting retirement on the back burner and putting all my savings towards my emergency fund.  I'm already living a frugal lifestyle and there really isn't much more I can cut to raise my savings contributions.  I'm not allowed (as part of my contract with the school) to get a second job.  Therefore the amount that I'm able to save is fairly stagnant.

I've run through the numbers and I believe I can fully fund my emergency fund just as I'm graduating.  Does that really mean I can't start saving for retirement yet? 

I think many people ask the same question as they struggle to pay off debt.  There are so many demands on our time and money that it can be hard to decide which one is most important.  While there are many logical "rules" that people stand by when making decisions like this, it's also an emotional decision.  My emotions are telling me that they want to have some sort of retirement account.

What do you think?  How do you decide where to put your saved money each month (retirement, emergency fund, credit card debt, student loans, mortgage)?  Do your emotional selves and rational selves ever disagree with your decisions?