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Catching Up

Steve Hulett / March 23, 2015

401k plan / no comments

401(k) enrollment time again, so here’s your new motivator:

According to the Center for Retirement Research at Boston College, the average retirement savings for households nearing retirement — those with head of households aged 55-64—is about $110,000. That means more than half of today’s households won’t have enough retirement income to maintain their pre-retirement standard of living, even if they work to age 65. The center says its survey clearly indicates that “many Americans need to save more and/or work longer.” …

1. Do a budget. Get a plan. Planning is the first thing. In order to see if you’ve saved enough, you have to first know how much you spend.

2. Have a plan for Social Security. Most people think they just need to figure out the age. But for married people, there are 587 ways to file for Social Security. You can increase the payout by about 32% if you do it properly.”

3. Sixty-two is not a magic retirement number. If you do the numbers and find out that you can’t retire at 62, you need to do some serious lifestyle adjustments, or work longer.

4. Work longer. Instead of looking at retirement as “I’m 65 and retired, and now I’m in trouble,” look at retirement in a series of five-year increments.

5. Stop paying for your grown children. Stop putting the needs of kids ahead of their own needs. (Like, don’t front them the money for the priciest university. Think cheaper.) …

You can never start saving for retirement too early. If you’re twenty-three, tuck money into investment and retirement accounts. If you’re thirty, put more away. Geezerhood might seem a ka-jillion years away, but the decades roll by quickly. And it’s easier to put less money into IRAs and 401(K)s early … with the magic of compounding working for you … than wait until you’re forty-five and discovering that the monthly nut you’ll need to contribute in order to retire comfortably is a total killer.

Just a thought.

Check for the next 401(k) Enrollment Meeting at your studio on the Event Calendar

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