Saving for your retirement is important if you want to enjoy a comfortable time once you’re ready to stop working and reap the rewards of your labor. But you might have heard that saving for your retirement is like climbing a mountain or running a race; it requires a lot of serious commitment and intense training, and that can be quite daunting. Instead, it might be better to approach saving for retirement as similar to learning a new skill like playing a musical instrument.
Successful retirement planning and saving are all about being consistent and putting in small yet regular efforts over an extended period, which is why starting early is an important aspect. Although you may not see huge gains on a day-to-day basis, the most important part is that you are always moving forward in the right direction. If you feel that it’s time to get started with being serious about your retirement savings plan, here are some of the main things to do to get off to the best start.
Calculate How Much You’ll Need:
You might be wondering, how much money do I need to retire? Having a savings goal in mind can make it easier when it comes to getting started with your retirement savings. You can use the retirement calculator here at Wealth Simple to determine how much you will need to put away over a certain period to enjoy the comfortable retirement that you’ve been dreaming of, or simply make sure that your expenses are going to be covered when you retire. Wealth Simple also offers a huge range of advice and tips on getting started with investing, which can seriously help you to grow your wealth and provide a boost to your retirement savings over time, compared to simply putting money aside.
Save With Your Employer:
One of the best ways to build your retirement savings is with an employer-sponsored retirement account, particularly if your employer will offer to match the payments that you make. Opening your retirement account with an employer that matches your contributions allows you to get free money into your retirement fund over time, helping you meet your savings goals faster.
Build an Investment Portfolio:
While saving is a key part of preparing for your retirement, it is also important to consider different ways to grow your wealth further with investment. There are various investment options that you may want to consider to help your retirement savings grow, such as stocks, which involve purchasing ownership shares in publicly traded companies, and bonds, which involve lending money to a company or government, which is repaid with interest after a predetermined period. To further diversify your portfolio, you may want to consider investing in index funds, mutual funds, cryptocurrencies, Forex trading, binary options, and various other investment opportunities that can help you avoid putting all of your money in one place. A diverse portfolio is a key to growing your wealth since it reduces your risk as an investor compared to putting all of your money in one investment.
Start treating your retirement savings just like you would treat any of your other priority bills such as your mortgage, rent payments, utility bills, and everything else that you must pay for every month. The best way to do this is to set up an automated payment from your checking account to your retirement savings account. If you have opened your retirement savings plan with your employer, you may have the option of paying into your retirement plan directly from your wages before you are paid, making it easier for you to budget for your expenses from the remaining amount. Setting up automated payments into your savings account means that you no longer need to worry about putting a portion of your income aside each month for your retirement, and you eliminate the mental component of having to physically move the money from your checking account to your savings account, making it easier for you to save.
Along with setting up an automated, predetermined amount of money to pay into your retirement savings account each month, micro-saving is another option that can help you grow your savings even further while you barely notice. Micro-saving is becoming increasingly more popular because it’s easier and has less of a mental impact compared to paying a large chunk of money per month into your savings account. One easy way to micro-save is to round up the cents each time that you spend money. Many bank accounts now allow you to do this automatically with settings that you can customize. Skimming the ‘change’ from your checking account is another micro-saving option that can seriously add up over time.
Put Extra Money Towards Retirement:
Bonuses at work, tax refunds, gifts, and inheritances are perfect for putting right into your retirement fund. When you receive money that is additional to what you are typically paid, you won’t miss it if you put it straight into savings. If you receive any type of windfall money, this is a great way to give your retirement savings a boost – resist the temptation to treat yourself and add it to your nest egg to see your savings balance rise.
Rethink Your Budget:
Perhaps you want to increase the contributions that you are making towards your retirement or are thinking about getting started with retirement savings, but don’t expect to see your income change any time soon. If the main reason why you haven’t started saving for retirement yet or haven’t increased your contributions is that you are struggling to afford it, it’s time to consider rethinking your budget. Going over and updating your monthly budget gives you the chance to identify any money that could be directed towards savings instead. This could be something as simple as canceling subscriptions that you no longer use or negotiating with your utility suppliers to get a better deal. Remember that you don’t have to drastically change your budget if it’s not realistic to do so. No matter how much money you manage to free up, anything extra towards retirement is a step in the right direction.
Eliminate Your Debts:
The thought of getting started with saving for your retirement can often feel impossible when you are dealing with high-interest debts like credit cards. While borrowing money is becoming more commonplace today and is often essential in certain situations, being in debt can certainly make it harder for you to save up and meet your retirement savings goals. Although it’s entirely possible to pay down your debts and save money at the same time, it’s a wise idea to focus heavily on paying off any high-interest debts before you start getting serious about increasing your retirement savings. Once you have cleared high-interest debts, you can then redirect the money that you’d normally use towards paying them off towards saving for retirement instead.
Consider a Side Hustle:
If you want to boost the amount of income that you’re bringing in to bolster your retirement savings, getting a side hustle could be the ideal option for you. Thanks to the internet, there are more ways than ever before to make some additional money alongside working full-time, whether you use some of it to supplement your income or put all of your additional income towards improving your retirement savings even further. Consider starting a blog, writing articles, running a podcast, starting a YouTube channel, selling your services as a graphic or web designer or offering online consulting services in your area of expertise; the opportunities are endless when it comes to side hustle jobs that you can do online from the comfort of your own home. If you prefer not to work online, there are plenty of offline ways to make additional cash, too – consider offering a service like pet-sitting, home cleaning, repairs, or babysitting in your local area, or make money by renting out an extra room in your home or sharing your car for a fee.
Get Financial Advice:
The best way to get started with a retirement plan that works well for you is to work with a professional financial advisor. A good financial advisor can be extremely valuable when it comes to helping you figure out how much you will need to save regularly to meet your retirement savings goals, how to choose the best retirement savings plan for your needs, how to choose the right investments for you, and advice on managing your budget, reducing your expenses, and eliminating debt.
Working with a financial advisor allows you to come up with a plan for retirement savings that is tailored to you and your circumstances, which will make the plan easier to keep up with over the long-term and boost your chance at success.
Saving for retirement can often feel like climbing a huge mountain or running a long race, but it doesn’t have to be that difficult. By making small, mindful changes to the way that you manage your money and turning saving for retirement into a regular priority, meeting your retirement savings goals may be easier than you think.