How to Beat Retirement

- Steve

In today's society, saving for retirement is very important for your future and there are five very important steps you can take to make sure your retirement is a great one.

Step 1: Max Out Employer Matches

Many employers will offer a 401(k) plan that says the company will match your contribution up to a certain amount. This is essentially free money that the employer will give you so it is crucial to take advantage of it. Who doesn't like free money!

Step 2: Possibly Open Up a Roth Account

With a 401(k) you contribute money into your retirement without being taxed. However, when you decide to take it out later in life you get taxed. A Roth account on the other hand, you get taxed when you make a deposit into your retirement. Roth's are usually most beneficial for those who are just starting their career because they are usually not being taxed at a high rate.

Step 3: Make Some Risky Investments

Great risk usually comes with great reward, but while investing at a young age for your retirement it is wise to choose volatile investments. The reason for this is because even if you have a bad year with your investments, you don't need that money for many years to come. This allows your investment to bounce back. All that matters is how much your investment is worth when it comes time to retire.

Step 4: Have a Plan

Making a plan for your future can include a lot of different things. One example is to figure out how much money you will need to save for your retirement. You can do this by using retirement calculator. Another example of planning is possibly starting to contribute to your child's college fund and how much you need to put away.

Step 5: Having Non-Retirement Savings

Many times in life unexpected events occur and there is nothing we can do about it. Also many times these events are costly so it is important to not have all of your money locked up in assets so that you are prepared for these emergencies that require a good amount of funds.

Overall, planning and saving for retirement can be very stressful and scary but with these five tips retirement can be a breeze. However in my opinion, above all these steps, the most important thing to know is the earlier you start saving the better, allowing the money you saved to compound, essentially giving you free money. In general, all of these tips will allow you to be prepared for the later years in life but most importantly you will be able to enjoy them.


Sources
Connick, Wendy. "5 Things Millennials Need to Know about Retirement." CNNMoney. Cable News Network, 30 Mar. 2017. Web. 02 Apr. 2017.  
"It’s Never Too Early to Begin Planning for Retirement." Quotes Pictures and Images Retirement Category. N.p., n.d. Web. 12 Apr. 2017.