Maximizing your retirement savings and tracking your progress are key to achieving the retirement lifestyle you desire
One of the most common goals people have is to live a successful retirement. But how do you keep retirement plan is on track?
Here are five strategies to maximize your retirement savings:
- Determine whether you are on track to meet your goals: It is important to know how much money you need to fund your retirement and to track your progress at least annually. You can use this Ballpark Estimate tool from the American Savings Education Council to determine whether you are currently on track.
- Invest early and often: The younger you are when you start contributing to your retirement plans the less you need to save. The key is to just start with what you can afford and contribute on a regular basis by setting up an automatic transfer from your account or paycheck to fund your IRA or 401k.
- Contribute to the appropriate type of retirement account:
- If you’re a working: Take advantage of the 401(k) or other employer-sponsored retirement plan — such as a 403(b) or 457 plans.
- If you’re married, but don’t work outside the home: Make contributions to a spousal IRA.
- If you’re self-employed: Are you saving for retirement? If so, do you have the right type of plan? Don’t overlook the retirement plan options available to you i.e. SEP IRA, Owner 401(k), etc. This is one of the best strategies for building wealth outside of your business.
- Maximize your contributions: If you cannot contribute the maximum just start with what you can afford and build from there. A good strategy is to increase your contribution each time you receive a raise until you reach the maximum contribution. If you receive bonuses, use part of the bonus to contribute to an IRA.
- Consolidate your retirement accounts: You should consider consolidating multiple IRAs and rolling over 401(k) s from previous employers. If you are no longer with the company, your money shouldn’t be there either. By consolidating into an IRA, it gives you more flexibility in terms of investment options and gives you a better picture of your portfolio.
Retirement planning is not just about the numbers. It starts with your goals. What does retirement look like for you?
You are in control…
You are in control of your financial future. Careful planning and a long term strategy can go a long way towards achieving your long term retirement goals and living the retirement lifestyle you desire.