Saving Money for Retirement: Best Practices
Very few people want to keep working until the end of their lives. However, if you don’t budget appropriately and save the right way, you might have no other option. While you may not have as much time to save as you once did, there are ways to either set aside a small amount of savings or boost the savings you already have.
Let’s go over some best practices to ensure you have enough money for retirement.
Start Now!
Again, it’s never too late to either start or boost your retirement savings. But if you keep putting it off, you’ll find yourself with no other choice than to continue working and saving. Avoid procrastination and commit to starting today on saving money for retirement so you enjoy a higher quality of life. Reading this article is a great first step!
Get Out of Debt
Before you can benefit from the compound growth of your investments you’ll first want to free yourself of any debt that is eroding your wealth with high interest rates. While a mortgage isn’t detrimental to your long-term retirement plans, compounding consumer debt in the form of credit cards can be.
Take Advantage of Employer Benefits
If your job offers a 401(k), it’s important to take advantage of it. This benefit lets you set aside money for retirement without being taxed for it. Plus, if your employer offers to match any percentage of it, that’s free money and will boost your savings even more. Other benefits to take advantage of include pensions, stock options and IRAs.
Set Up Automated Saving
There are apps and other technological solutions these days that allow you to save money without even thinking about it. Take shopping, for example. Did you know that there are apps that can round up your purchase to the nearest dollar and save the rest? Spare change adds up over time. You can also set up direct deposits to a retirement savings account, create automated contributions for your investments and more.
Create a Budget
If you’re not getting as much traction on your retirement savings as you’d like, step back and consider your goals. Then decide on a budget and allocate it in a way that helps you meet those goals. Budget on a cadence that works best for you—daily, monthly, annually—and get friends or family involved in the planning!
Delay Social Security
If at all possible, try to delay Social Security payments until you’re ready for retirement (or close to it). Every year before your turn 70 is an increased amount you’ll receive, after all. There are more potential survivor benefits for spouses when you delay Social Security payments. Maximize what you’re going to get by taking payments as late in life as possible.
If you’re considering a retirement community and are interested in budgeting or costs, contact us today and we’ll get your questions answered.