Maximize Your Retirement Savings To Help Secure Your Financial Future
Here are 7 things you can do right now!
- DO save as much as you can now in your qualified retirement plan. That may get easier as you earn more throughout your career, but the goal should be to sock away at least 15% of your gross compensation annually.
- DO save for both you and your spouse. If you’re married, you should BOTH be saving 15%. No falling back on the excuse of “she makes more than I do” or “he’s a better saver than I am.”
- DO take advantage of your company’s match. If your company matches your contribution, make sure you contribute enough to take advantage of the full company match, otherwise you are effectively leaving money on the table.
- DO be aggressive. If you have at least ten years until your anticipated retirement date, you could be aggressive in your portfolio, which could mean allocating a high percentage in stocks. This time horizon should provide ample cushion for those volatile periods (more on that below).
- DO be disciplined. Regardless of what may be going on in the markets, contribute regularly to your 401(k) plan. If you are at least 5 years away from your retirement date, stick with your allocation plan. Consider a down market a great time to buy stocks “on sale”!
- DON’T panic when the market gets volatile. It’s a natural emotional reaction to want to pull back when markets decline, but history demonstrates that they always rebound, and then some. Stay the course…if it makes it easier, check your portfolio less often during turbulent times.
- DON’T take a 401(k) plan loan. It is a terrible deal, and monies can be permanently removed from the account if you default after changing jobs.1
1This information was developed for education and information purposes only and is not intended as authoritative guidance, ERISA, tax, legal, or investment advice. Each plan and individual has unique requirements and you should consult your attorney or tax adviser for guidance on your specific situation. In no way does Frye Retirement Planning (FRP) assure that, by using the information provided, a plan sponsor will be in compliance with ERISA regulations. FRP offers no tax, legal or accounting advice, and any advice contained herein is not specific to any individual, entity or retirement plan, but rather general in nature. The information does not necessarily reflect the opinion of Frye Retirement Planning and should not be construed as recommendations or investment advice.
