Start Boosting those Retirement Savings Today
Rising living costs and increased job losses have made it more difficult than ever for individuals to start, add to or maintain decent retirement funds. Over time, this will result in them not being able to afford to live once they’ve stopped working. Below are a few ways in which you can get that retirement nest egg to start growing without it having a major effect on your current living standards.
Use Tax Refunds Wisely
Several individuals use tax refund money to purchase luxury items that they would otherwise not be able to afford. Instead of doing this, consider investing 50% of it before doing anything else. Large amounts of money are great to receive each year, but they can be made even more enjoyable when at least a portion is left to accumulate interest.
For example, if you’re fortunate enough to earn $100,000 a year and you receive a $2,000 refund, investing just half of it would be the equivalent of increasing your existing 401(k) contributions by a full 1%.
Don’t Squander those Raises
Raises are generally seen as rewards for remaining loyal to your employer and proving your value as an employee. While it is tempting to increase your standard of living whenever you receive a raise, this won’t be too beneficial to you when the time comes to stop working.
Instead of spending the full amount of the raises you receive, consider saving 50% of it instead. For instance, if your raise amounts to an extra $50 per week, save $25 of it and use the rest. Saving this amount will enable you to still enjoy the fruits of your labor, but you’ll also be securing your retirement at the same time.
In most cases, the easiest way to save 50% of your raises will be to direct them to your 401(k) account because this will redirect the money automatically.
Consider Investing the Earnings from a Side Job
These days, thousands of Americans are working side jobs, either out of sheer necessity to make ends meet or to give their retirement funds a much-needed boost. Many of them have even been fortunate enough turn hobbies into paying gigs as well. If this is the case for you, why not consider using this to your advantage and save half of the earnings into a high-yield savings or retirement account?
While not everyone working second (or even third) jobs will be able to afford to save the earnings from these endeavors because of having to simply make ends meet, keep in mind that if you are able to save these funds, it will give your retirement nest egg a valuable boost.
Your main goal should be to save as much money as realistically possible without having to do without the essentials, and the advice above will go a long way in helping you to boost your retirement fund. Saving half of any extra funds you receive will still allow you to enjoy some of the extra cash – but you’ll also enjoy peace of mind in knowing that you’re securing your financial future at the same time.