Are you truly prepared for retirement? Many of us believe we are ready, that we have saved enough.
Most of young Americans in their 20’s don’t even think about it, it’s not a big priority. For those in their 30’s and 40’s they are thinking about it and saving some money but not enough.
First of all, not everyone takes advantage of the 401k plans offered by their employers. And for those that do invest into it, they don’t invest enough or don’t know exactly how to use it to their advantage.
For those of you thinking that it’s no big deal, you have social security waiting for you, think again. Many of us will not even see that money and if we do, it won’t be much. It’s time to take control of our finances and prepare ourselves for the future.
ENROLL IN 401k
All companies do not offer 401k, if you are lucky enough to work in one that does, take advantage of it. Many won’t do it because they feel they will miss that money that is taken away. To be honest, after a few paychecks, you forget and learn to live with it. Besides, it’s for your benefit.
CONTRIBUTION RATE
For those participating, consider raising your contribution rate. By just increasing it by 2%, you can accumulate an extra $100,000 or more, depending on your age. The more you invest, the more you will have at the time you retire.
CASH OUT
Many cash out as soon as they leave their jobs don’t do it. First of all, doing this will incur penalties of over 10% for early withdrawal. If leaving your employment for another, consider rolling it over or investing it in an IRA. The minute that money hits your bank account, it will disappear. As much as you say you want to save it, something always comes up.
FREE MONEY
Some of those that invest in 401k contribute less than what the company will match. Why give away that free money? If your company matches up to 6%, at least make that your contribution to 401k. Take complete advantage of what the company is offering you; don’t let it go to waste.
ADVICE
Many of the 401k companies offer advice and help you invest your money wisely to get the most out of it. Most of us will do safe investments which are good but the older you are the more aggressive you should be with your investment. Take advantage of all the tools they offer you and avoid guessing as to what will be good for you.
AVOID UNCERTAIN RISK
Don’t risk losing your opportunity to save money for your future. When investing avoid concentrating in company stock, safe bets, contributing less than what is matched, or not using the tools given to you. Invest properly, you will be amazed as to how much you can make if you just take the time to do some research. Always ask questions, they are more than happy to answer.