But what happens to the fourth person? They probably saved but did not tuck away enough to see them through the coming years.
According to statistics, 50% of workers who are in their 40’s have less than $25,000 worth of retirement savings. On the other hand, six out of ten have less than $90,000.
People save what they can and opt to count their chips later on. However, it is never too late to get started, the following tips will ensure that you are ready and set before retirement comes calling at your door:
1. Get started
If you have not started tucking away a considerable amount of cash, you can focus on getting started today. Begin saving and investing as much as you can now. In order to get better interest, let you investments compound by constantly reinvesting.
2. Open an IRA
An individual Retirement Account comes in handy during this period. You are free to choose between Traditional IRA’s and Roth IRA’s.
Traditional retirement accounts are tax-deductible and give the opportunity to grow tax deferrals until you make the withdrawals during retirement.
On the other hand, Roth accounts are funded with after-tax contributions and qualify you for withdrawals by the time you are 60 years of age.
3. Cut down on extravagance
Examining your budget is a great way to put everything in perspective in regards you spending too much money unnecessarily.
For instance, you may choose to negotiate a lower rate on good car insurance or opt to carry lunch to work instead of spending money on expensive restaurants. When you reduce spending, you will find it easy to save.
4. Contribute to your 401 (k)
401 (k) plans allow for the contribution of pre-tax money which is a significant saving advantage.
For instance, if you are part of the 15% tax bracket and plan to contribute $80 per pay period, the money is deducted from your paycheck before taxes are accessed. You take-home will only drop by $65 but you will be saving for the long term.
5. Automate, Automate, Automate!
Automating your savings means making them automatic each month. This is a way to move up to retirement goals. Funding services like the Merrill Edge Automatic Funding Service invests automatically in specific funds and ensures that you are set up for the future.
The earlier you start saving and investing, the more prepared will you be for retirement when you are in your 40’s. Do not let life get in the way of a financially stable future. The above tips will help you switch to overdrive mode instead of only puttering along in the first gear.
Recognizing the importance of retirement saving is the first step. Share this article on your Facebook wall and help the person next to you equally get ready for their forties!
- Multiple award winning bank with 3 tin canisters. Each canister has either save, spend, or share on the side.
- Each canister measures 5.25 " tall. When held together be the included rubber band the set measure 5" wide x 5" long.
- Moneybox includes a paper passbook with sections for kids to indicate what they deposited and withdrew from each of the save, spend, and share...
- Paw Patrol Chase Bank
- Watch their savings grow
- Great Quality
- 【Clear LCD Display】 You can pass coins through the lid's coin slot and the LCD display shows off how much you saved!
- 【Great for Children】 All ages kids will love watching their savings grow and makes retrieving their coins simple and hassle free.
- 【Accepts All US Coins】 including: Pennies, nickels, dimes, quarters, half dollars and dollar coins
Last update on 2020-03-19 / Affiliate links / Images from Amazon Product Advertising API