Do These 3 Things Immediately To Boost Your Retirement Savings
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Saving money hasn’t been easy for millions of people over the last year. Loss of jobs, reduction in bonuses, and major financial setbacks make comfortably retiring someday seem like an impossible dream.
Here’s the good news – bolstering your retirement savings is still possible no matter your age.
Whether you’re just joining or rejoining the workforce or closer to retirement than ever before, it’s still possible to bulk up your retirement savings, and it’s never too late to get started.
Merrill Edge, the investing arm of the Merrill Lynch company, put together a helpful list of 10 tips to help boost your retirement savings – whatever your age – but three of the tips stand out above the others.
Merrill Edge first suggests focusing on today and start saving as much as you can now as well as contributing to your 401K, meeting your employer’s match, and opening an IRA.
These are all vital steps, but the key takeaway from the article comes at tips 5, 6, and 7.
Take advantage of catch-up contributions if you are age 50 or older
This might be the only time that playing catch-up will be beneficial.
Beef up your retirement savings by making up for all the lost time that you didn’t put money away for your golden years.
“One of the reasons it’s important to start saving early if you can is that yearly contributions to IRAs and 401(k) plans are limited. The good news? As of the calendar year, you reach age 50, you’re eligible to go beyond the normal limits with catch-up contributions to IRAs and 401(k)s.”
MORE ADVICE ABOUT RETIREMENT
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Automate your savings
Intending to put money away each month is much different than actually putting money away.
Unfortunately, sometimes life gets in the way, and the extra money earmarked for savings goes to items like new tires for the car, patio furniture for a summer of grilling, or concert tickets now that the world has reopened.
Merrill suggests leaving the human element out of the equation and automating the retirement savings process every month.
“You’ve probably heard the phrase ‘pay yourself first.’ Make your retirement contributions automatic each month, and you’ll have the opportunity to potentially grow your nest egg without having to think about it.”
Rein in spending
With the pandemic hopefully in the rearview mirror, the temptation to go places and spend money has never been higher. Now, more than ever, people need to budget.
“Examine your budget. You might negotiate a lower rate on your car insurance or save by bringing your lunch to work instead of buying it.”
The article suggests using a cash flow calculator to determine where your money is going and to find places to reduce spending to turn around and invest in your retirement savings.
Head over to Merrill Edge to read the other suggestions on ways to boost your retirement savings.