The Blueprint for Retirement Saving
You hear that you should save for retirement all the time. However, you never hear about how you should do it. So, what should you do? Well, here’s a basic blueprint for retirement saving for your convenience.
In your 20s, the only thing you need to remember about retirement is to start saving for it. Retirement may be a million years away but saving for retirement is a marathon, not a sprint. No matter how small, the money you put into a retirement account will gain interest and continue to grow until it’s withdrawn. The sooner you start saving, the sooner that money will begin to earn interest. Save what you can and watch your money grow.
When you’re in your 30s, saving for retirement becomes more complicated. If you haven’t started saving, start now. It’s better to start late than not to start at all. After that, start paying off your debts. Money used towards debt is money not being saved for retirement. Get your debt paid off and get that load off your shoulders. Also, if you can, contribute to an HSA. Any money you put into an HSA can be used for medical expenses. However, you can withdraw from it for any cost, without penalty, once you turn 65. It acts as another savings account if you don’t have any significant medical issues.
Life gets even more complicated in your 40s, and you may be tempted to make crazy decisions — but stay strong! It’s in your 40s when you should max out your contribution limits. Your retirement account will start making real money at this point, and you need to take advantage of it. It would help if you also started planning how you want to live during retirement. You have forty years of life experience, meaning that you know how to make a realistic plan, unlike in your twenties. You can’t live a good retirement without a plan.
Once you’re in your 50s, you’re in the end game. This is when your contribution limits increase, and you must take advantage of it. Also, it would be best if you got a financial adviser. You may be smart, but it’s always a good idea to hire someone who can help protect what you’ve saved and maximize its potential.
It’s not too hard to save for retirement if you use this blueprint. Now get to saving for your retirement. For more information, please contact us.