Though most adults want to make saving for retirement a priority, it often gets put on the back burner as they deal with more pressing concerns like things they want to do in present and unexpected life events. For this reason, it should come as no surprise that three out of ten American adults report that preparing for retirement stresses them out, both mentally and emotionally. However, it doesn’t have to!
The path to retirement savings is a personal one that is unique for every individual. The right tools and strategies will depend on what your individual goals are and what life stage you are currently in. This post will c1over some of the top tips for saving for retirement that can work for every generation from Millennials to Generation Xers to the Baby Boomers.
- Set realistic retirement goals.
Did you know that according to CNBC, 81 percent of American adults don’t know how much money they will need to retire? Though 40 percent estimates they will need about $500,000, the truth is that this figure is still about $250,000 short of the average retirement cost.
Though there is no one magic number for retirement savings that works for everyone, it’s important that each individual takes time to consider and calculate their retirement savings needs. How much you need to save for retirement will depend on a variety of assumptions, such as how long you think you will live and what your needs will be in the future. Take time to consider these factors to come to a realistic retirement savings goal that will allow you to live comfortably in retirement.
- Plan, prioritize, and protect.
When it comes to saving for retirement, it’s essential that you adhere to the three P’s – plan, prioritize, and protect. Your plan for retirement will play a significant role in helping you reach your savings goals. Financial professionals suggest that you consider how much you will need to save to provide a comfortable monthly income for yourself in retirement. If your current savings and projected savings is cutting it a bit short, consider how much more you’ll need to save each month to reach your goals. Then, prioritize your spending to find where you can save a little extra each month.
It’s easy to feel overwhelmed when creating a retirement savings plan. The good news is that you don’t have to go it alone. Working with a financial adviser can help you create a realistic retirement savings plan that will allow you to reach your goals over time. It’s also important to remember that life is full of surprise events and unexpected costs that can potentially derail your retirement savings. However, putting together an emergency fund that you can use to handle these unexpected costs allows you to protect your retirement savings.
- Get the most out of employer-based plans.
One of the easiest ways to start saving for retirement at any age is to take advantage of the retirement plans that your employer offers. Employer-based retirement savings plans often come with an employer match, which is essentially money that your employer puts into your retirement savings based on how much you are contributing.
If you are unsure of what types of retirement plans your employer offers or have questions about employer matching, make sure that you contact the human resources department and ask questions. Not taking advantage of these company-sponsored retirement plans with employer match is like giving up free money that could be going toward your retirement savings.
- Ask questions, and get answers.
One of the most important things to remember about saving for retirement at any age is that you need to ask questions if you are not sure of something. Though you may be afraid of looking dumb or you feel uncomfortable seeking answers to your questions, getting answers to your retirement questions is vital if you want to plan effectively for retirement.
Consider this – while 72 percent of Millennials admit to not knowing as much as they should about saving for retirement, only 36 percent actually seek help from a financial advisor. When it comes down to it, you need to seek help and get answers to your retirement questions. Your retirement savings may depend on it!
To see how your retirement planning stacks up against your peers, check out the infographic below, which provides more valuable data on saving for retirement:
INFOGRAPHIC LINK:
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