- January 9, 2018
- Posted by General Electric Credit Union
- 4 read
6 Tips to Boost Your Retirement Savings in the New Year
It’s a new year and a great time to re-evaluate your savings strategies to ensure you’ll meet your retirement goals. No matter where you are in life, it’s never too early to start planning for retirement. Here are a few ways you can boost your retirement savings in the new year.
Set a goal
Use a retirement calculator to roughly estimate how much money you’ll need during retirement – even a rough ballpark figure is good for now. Then, it’s time to start planning on how you can reach that goal by narrowing down the focus to set a monthly goal. Make sure this is attainable and adjust your budget accordingly. Don’t have a budget? It’s time to start with Money Management.
Contribute to your 401k (and meet your employer’s match)
If your employer offers a 401k, you can contribute pre-tax money. Since that money comes directly from your paycheck, it’s a great hands-off way to save. If your employer matches your contribution, take full advantage of that match. For example, if your salary is $50,000 and your employer matches 50% of your contribution up to 5% of your salary, you’ll contribute $2,500 and they will kick in an additional $1,250. Don’t lose out on the essentially free money. Keep in mind, many companies have a vesting period; if you leave prior to the end of that period, you will not receive the matching funds.
Automate your savings
Out of sight, out of mind. By automatically transferring funds into a retirement account, you can save for retirement without even lifting a finger or doing the legwork. Set up payroll deductions or automatically transfer funds through online banking with your financial institution.
Open an IRA
Even if you have a 401k, consider opening an individual IRA account to help build your savings. While there are a variety of IRA’s, Traditional and Roth are the most popular. Take a moment to understand each type of account and meet with a Member Consultant to select the best option for you.
Stash extra funds
Workplace bonus? Birthday check from your family? Don’t just spend it. Perhaps treat yourself to something small and put the rest aside for your retirement. If you receive a raise at work, put at least half of your new money into a savings or retirement account.
Pay off debt
If you carry any debt and make the minimum payments every month, potential retirement savings are going directly to your debt. If you’re facing credit card debt, making only the minimum payment is setting yourself up to pay even more in interest over time. Begin applying as much as you can to pay off your balance, then pay the balance in full every month. Over time, you will have more money to put toward your retirement.
Realizing the importance of saving for your retirement is the first step. Invest in yourself by taking some time and establishing how much you need to save and how you can reach your goals. No matter where you are in life, there’s always time to start saving. You’ll have to work at it, but don’t get discouraged. Meet with a GECU adviser who can guide you in a direction that will work for your goals.