Ways to Boost Retirement Savings

Posted on 04/26/2011

Retirement may seem like a faraway land full of golf games and early bird specials, but the fact is the earlier you start saving for it the better it will be. According to the Employee Benefit Research Institute, 68% of us do save for retirement; the problem is nearly half have socked away less than $10,000 which won’t fund more than a few months worth of our golden years. The problem for most of us is that more urgent needs seem to get in the way—like pesky car payments and health insurance. But with these tips you can boost retirement savings without severely impacting your current lifestyle.

Increase 401k Contributions
According to statistics, on average American workers contribute 7% to their 401k. Bump that up to at least 10% and you’ll end up with much more in the bank by the time retirement rolls around.

Automate Your Savings
The easier you make setting aside savings, the more likely you are to do it. Enlist the help of a financial adviser to set up a monthly automatic withdrawal from your checking account straight to an IRA.

Don’t Spend Your Tax Refund
For many tax payers the annual refund seems like free money. The amount is usually somewhat unexpected and not necessarily earmarked for anything specific. Put that money to work by saving it for retirement. That’s the idea behind a new government test program called SaveUSA. Residents in certain cities can receive a 50% match, up to $500, when they save part of their tax refund. The program is expected to expand to other areas soon.

Be Kind to the Future You
When you’re young you never think about getting old. But if you do you might be more motivated to save for your older self. Upload a photo of yourself to in20years.com and in moments you’ll be face-to-face with the future you. But whether that person will be eating steaks or Spam is up to you and how much you save now for retirement.

By Alison Storm

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