[Infographic] How to Save & Invest for a Comfortable Retirement
It's no secret that the earlier you start planning for the future, the more opportunities you will have to build wealth. Luckily, there are plenty of strategies you can use to save for retirement. To learn more about how to save and invest for a comfortable retirement, check out our guide below.
Invest in Retirement Accounts
The most common way to invest in your future is to use traditional retirement accounts such as IRAs or 401(k)s. Remember that while IRA’s have more investing options and aren’t attached to an employer, 401(k)s often feature an employer-matching benefit that can help to significantly increase your investment over time.
That said, you don’t have to limit yourself to one type of retirement account. Many people diversify into different risk and asset classes such as IRAs, 401(k)s, annuities, and even cash-value life insurance. So long as you’re consistently putting money away for the future, you are on the right track.
Find Your Lost 401(k)
Speaking of 401(k)s, as you change employers, it’s not uncommon to lose track of your account. To avoid leaving money on the table, it’s important to take the necessary steps to locate your old 401(k).
To start, try contacting your old employer directly. As long as they are still in business, your old company should be able to reunite you with your forgotten 401(k).
That said, sometimes companies go under or are acquired, which means you’d want to check your previous 401(k) pay stubs to find the contact information of your plan administrator. After you give them a call, they should be able to guide you to your missing account.
Envision Your Ideal Retirement
In the beginning stages of planning your retirement, you should create a goal to work toward. Once you have a solidified vision of how you want your golden years to look, it will help you determine how much you should be saving while providing you with the motivation to do so. After all, it can be difficult to save when you don’t have an end goal to work toward.
Once you’ve envisioned your ideal retirement, it’s time to outline a budget. First, evaluate your current spending habits. How much are you spending on necessities, such as groceries, water and gas? How much are you spending on luxuries, such as movie tickets, restaurant meals or vacations?
After you’ve evaluated your current spending, calculate your retirement savings goal. To do so, calculate your current monthly budget and multiply it by 12. From there, multiply that number by the number of years you plan to spend in retirement. This should give you a good starting point to work towards.
Finally, you should start looking at how much you’re currently saving and calculate whether you can realistically reach your goal in time for retirement. If the answer is no, you may want to cut back on a few luxuries in order to save a greater amount each month. (See our article on "The 4 Most Important Retirement Questions" for more about analyzing your options.)
As you save for retirement, you might run into obstacles along the way. Sometimes emergencies pop up or you spend too much on luxuries, causing you to fall short of your monthly savings goal. If this happens, you may need to reevaluate your retirement plan and make appropriate adjustments.
Through well-thought out, consistent savings strategies, you can put yourself on track to a comfortable retirement. For more information about retirement investment accounts and savings strategies, please contact our office, or check out the infographic below.
The information presented here is for educational purposes only and is not a solicitation for the purchase of any insurance or financial product. This information has been provided by a Licensed Insurance Professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice.