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Start Now to Plan for Retirement

A few years ago, someone who had recently retired was asked, “So, you finally saved that last dollar, huh?” To which the retiree replied, “It wasn’t the last dollar I saved that made it possible. It was the first.” The message? The sooner you start saving for retirement the better off you’ll be. On the other hand, it’s never too late to start saving for retirement. Every dollar you put aside from now on will make your retirement years better.
Following are a few tips on preparing for the day you get that gold watch.

Start today. Even if you have to start small, start now. A few dollars a month starting today will do more for you than a bigger monthly investment started a few years from now.

Know what you’ll need. Figuring out how much you need for retirement can be hard, but you’ll find a lot of online calculators that can help. Get as good a figure as possible, then make a plan for getting there.

Contribute to your employer-sponsored plan. If your employer offers a retirement plan, take advantage of it. You’ll usually be able to set aside pretax money, and the plans often come with guidance from investment professionals.

Meet the match. If your employer offers a retirement-contribution match, max it out. That’s free money that will grow for your future.

Open an IRA. IRAs are a great option if your employer doesn’t offer a plan, if you have contributed all you can to that plan but want to save more, or simply want to diversify your retirement savings.

Tap the benefits of index funds. Index funds are popular for a reason: They generally outperform managed funds and the fees usually are lower.

Take advantage of catch-up contributions. When you are age 50 or older, you can contribute extra money to your account.

Set it and forget it. Have money automatically deposited into your retirement accounts – either from your paycheck or your bank account – so you don’t have to think about it every month.

Get help. If your employer offers retirement-planning services, use them. If you work with a broker or financial planner, tap into their services. Your bank might offer free assistance, as do some professional and community organizations. Regardless, seek out guidance from someone who can help you set goals and make a plan.

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