News alert – if you were to ask someone older and wiser about your retirement savings, most would say he or she had wished they had started saving sooner.
Are you surprised? Me – not so much. We are all so much smarter with HINDSIGHT.
If you are younger maybe you haven’t given your retirement much thought. For those who are older and neglected this part of their finances, chances are you are panicking about the ways you can catch up and save more.
Saving for retirement doesn’t have to be painful or challenging.
There are many strategies to increase your savings each month without negatively affecting your lifestyle.
Obviously whether you make this a priority or not depend on your age but please don’t totally brush it aside if you are in your 20s or 30s.
Seriously it is NEVER too late to start thinking about your retirement and life after you finish work.
You can these easy strategies to increase your retirement savings:
1 – Avoid impulsive selling of stocks.
Avoid jumping to the conclusion that you must sell your stock quickly just because the market is dropping.
Do you have reason to believe that your investments will no longer be attractive in the long term?
Are you even thinking about their long term growth?
Sell your stocks only for a specific reason. Don’t do it because you feel like you have no choice to do so RIGHT NOW.
- HINT – A falling market can actually be the best time to look for buying opportunities.
2 – Downsize ahead of schedule.
If you’re going to sell the house and purchase a smaller home, why not do it now?
You can potentially a good deal on a smaller home and cut your expenses now. These savings can be put towards your retirement.
3 – Set a savings goal.
If you know me well, you know I LOVE goals. Goals are super effective at improving the likelihood of success.
Consider creating a savings goal for the next 3 months and strive to meet it.
If you set a concrete goal you have a better chance of reaching it rather than setting no goal at all.
Remember an effective goal is supposed to be challenging and SUPPOSED to stretch you (while also remaining in the realm of possibility). When set right, goals encourage you to work harder than ever before.
4 – Focus on inexpensive investments.
The goal of investments is to make you money so choose wisely.
Note: Index funds are among the least expensive investments and provide excellent returns.
When it comes to investing, do your research and look at the profit and return. Focus on investments that give youÂ more bang for your buck. Avoid paying high fees for the returns you receive.
5 – Get started right away.
Time is the most important factor in accumulating a large nest egg.
If you look into compound interest, you will see the beauty of its impact comes from starting SOONER rather than later. This is where you can make time work for you.
If you start early not only will you contribute to your retirement over a longer period, but your investments have more time to grow. A small start earlier is usually better than a later start with more.
6 – Contribute enough to your 401(k) to receive full matching.
If you live in a country that matches your 401(k) contributions take advantage of it. It’s literally free money! Ensure that you’re getting all that you can and start early. Honestly later on down the track you will wish that you had started earlier.
Many companies also offer a generous matching contribution setup where they match a percentage of an employee’s contribution. Look into this and see how you can make it work to your benefit.
7 – Save on autopilot.
Most of us act on autopilot – we pay your bills and have your fun, and then save whatever money remains at the end of the month.
This might sound pretty normal to you, but it is rarely effective. Because here’s the truth – your spending will increase or decrease to match the availability of funds.
If you save first on autopilot (that is, have it automatically deducted from your account) you have a higher chance of saving more than you usually would. If left to their own devices, many people have zero left to save at the end of the month.
Save a percentage of your income before it even hits your bank account.
- See if your human resources department can help you set this up. If you have to do it yourself, transfer money into savings automatically after you’re paid.
8 – Negotiate your monthly bills.
Are you certain you have the best car insurance rate? If you threaten to cancel your cable service, is there a chance they may offer to lower your rate?
Some things really are negotiable and you don’t even realize it. Your credit card company may even lower your interest rate if you inform them that you would like to move your balance to another card.
- Many companies would rather receive less money from you than no money at all.
9 – Save your raise.
Receiving a raise at work is just the best, right?
But really it is bonus free money. Consider the fact that you’ve been living without that raise thus far. An option is to apply your raise to your retirement savings instead.
You can’t miss what you’ve never had, and your savings will grow.
If you’re one of the many people who feels like they are behind on their retirement savings, there’s still time to make a difference.
A few, simple changes can increase your rate of savings and the size of your nest egg.
Just through the list of options again and see which strategies you can apply as soon as possible.
You can also do more research into investment opportunities until you find something that works for you.
The most important thing is that you get started! Getting started is often the hardest part but you won’t achieve anything different if you don’t at least begin. The time to work on securing your long-term financial future and increasing your retirement savings is now.