Retirement is a laid back, relaxed phase, where all you want to do is chill and catch up with all the fun you couldn’t in your prime, busy years. But one thing is sure – your retirement will be a blissful phase if and only you have planned your finances well, well enough to help you cruise through your retirement smoothly. Here are a few tips which you can consider while setting up your retirement corpus.
No matter what age you are, you have to start setting aside small sums of money to fill up your retirement fund. The higher the amount you invest now, the greater will be the comfort and ease during your retirement years. So no matter what the amount, start saving right away.
Watch out for your 401(k) contribution:
Both you and your employer contribute to the 401(k). The amounts will vary, while the employer has a statutory obligation which he has to follow, you are free to put in any amount you wish to. But try to match the amount of contribution your employer is pitching in with. You will have a substantial monthly contribution going towards your retirement corpus. Also, whenever you get a raise, watch out and make sure your 401(k) contribution increases accordingly too.
Adjust your 401(k) contribution percentage:
You have the option to increase the percentage of the salary you want to contribute to your 401(k) fund. For example, when you have a bonus, you can increase your contribution. You can also revert back to your original percentage in the next pay period – so there’s nothing to worry about.
Automating your savings will help – the moment you receive your pay, the amount of savings will automatically get diverted to your retirement corpus account. This leaves you with the rest of the sum which you can spend, or invest wherever you wish to. Also, the temptation to spend off the money to be saved vanishes away!
Well, you need to start off with planning! Have a goal in mind – that will help you chart out better ways to meet the goal. If you want to have a specific amount of retirement fund, you can reverse calculate the amount that you have to set aside every month. Achieving your goal will be easier this way.