Want to feel more financially secure in your retirement? Step one: Speak to a financial professional. Step two: Read on to learn a few more tips for saving and planning for retirement.
Start Saving NOW
The earlier you start saving, the more time you give your retirement assets to grow in value with compounding interest.
Pay Down or Consolidate Debt
It’s easier to save for retirement when you aren’t using your monthly income on credit card bills, medical bills, and other debts.
Get Your Company’s Match
A number of companies will offer to match your 401K contribution. Whether it is a small percentage or the full amount, remember that every dollar counts. Contribute your pretax dollars and make sure you are donating to the max amount your company will match.
Contribute to a Roth IRA
With Roth IRAs, you’ll contribute money after taxes are taken out of your check. However, after age 59, withdrawals are not income-taxed.
Use Other Avenues
According to Investopedia, you can save for retirement without an IRA or 401K, though not recommended.
These other avenues should be used with 401K or IRA or in place of if those options are not available. These include:
- Brokerage accounts
- Real estate investments
- Small business investments
Build Up to at Least 15%
Most financial professionals recommend investing 15% of your income into your retirement savings. The closer you are to retirement, the more you should invest – especially if you are making up for lost time. If you can’t afford that much, start with at least something and build your way up.
Don’t Believe the Myths
It’s too late. It’s never too late. Reduce your living expenses, save more aggressively, reconsider your retirement goals, and look into part-time work or the gig economy when closer to retirement.
My kid comes first. When you are close to retirement, you need to take care of yourself. If your children are adults who are capable of taking care of themselves, you need to cut the cord and send them off to be adults and take care of themselves. You’ve been selfless while raising them. It is time to make sure you are taken care of.
I need a big income to create a big nest egg. Pay off your debts and create a monthly budget to have more money to put towards your retirement.
I can just live off Social Security. According to the Social Security Administration, Social Security benefits represent only 33% of the income of the elderly. Most retirees must supplement their income with savings, work, or help from family, according to an article by retirement advisor Chris Hogan.