If you feel that you have not saved enough for retirement, then do not feel that you are alone. A recent survey found that one in three Americans have no retirement savings.
It is never too late to take action to beef up your retirement finances. As with many things in life, the time to start is right now.
Investopedia shares tips for retiring with a net worth much smaller than what many of the experts recommend you have.
1. Commit Your Raise
If you’re still working and get a raise, bonus or some other form of extra compensation, commit it to your retirement savings. Unless you absolutely need that extra money to live on – you probably don’t – your retirement funds are a great place to stow it. Remember, even if you’re retired, you can still save for retirement.
2. Commit Your Tax Refund
We all want to use our tax refunds as play money, but if you’re behind on your retirement, that’s not a wise idea. You can deposit the money directly into an IRA using IRS Form 8888.
3. Invest in Your 401(k)
If your company is matching your contributions, you must invest in your 401(k). It’s free money. Even if your company plan isn’t very good, your company is paying you to be involved. “Save as much as you can in there until it hurts.” says Cassandra Toroian, president and chief investment officer, Bell Rock Capital.
4. Delay Social Security
If you don’t need Social Security when you’re first eligible at age 62, don’t take it. If you can wait until you reach 70, you could get nearly twice as much. That will likely mean working longer, but it might be worth it.
5. Get a Cheaper Car
A car is just one example, but what are you spending money on that you could cut? The lawn service? A rarely used gym membership? Expensive cable TV channels?
6. Downsize Your Home
Maybe all of the kids are gone, but you’re still living in that big house. How much could you bank for retirement if you sold your home and found something smaller? There are a lot of financial variables involved in this decision, so talk to a financial planner to see if it’s right for you.
7. Learn a New Skill
If you’re entering retirement you probably don’t want to learn a skill that’s overly physical, but how about something like consulting work? Or maybe you’re good with computers and could learn a computer language. Learning something that can earn you extra money as you age means you can continue working well into retirement.
8. Get Aggressive with the Budget
First, if you don’t have a budget, start one. “A budget is like a roadmap or game plan. It clearly lays out your sources of income and expenses and the difference. By having it clearly in front of you, you can see how you can adjust your income or expenses to reach the overall savings goal you desire or need,” says Mark Hebner, founder and president of Index Fund Advisors, Inc.
Some great tips. I urge everyone to not rely on Social Security as your only source of retirement funds. By the governments own reports, the entire program is going backrupt.
Read more: www.investopedia.com