It’s that time of year again. The holidays are over, and the New Year has begun. If you’re like many Americans, this is also the time of year when you evaluate your life and vow to make positive and impactful changes.
Common resolutions include things like losing weight or quitting a bad habit like smoking. You may resolve to keep in better contact with family and friends or perhaps perform better at work. As you’re sorting through potential resolutions, don’t forget about retirement planning. Nearly two-thirds of Americans say they are concerned about not having enough money to retire.1 If you’re part of that group, consider making 2017 the year you finally get back on track.
Below are a few resolutions to boost your retirement planning. If you can stick with these goals, you should find yourself in a much stronger position in no time at all.
Create a budget and stick to it.
Two-thirds of American households don’t use a budget.2 That’s unfortunate, because a budget can be one of your most helpful and useful financial tools. It allows you to keep your spending in check, and it helps you see where your money goes on a monthly basis. If you see in the budget that you’re spending too much on things like dining out or shopping, you can simply rein in those expenses.
Without a budget, it’s difficult to know whether you’re on track or if you’re adhering to your plan. Take some time early in 2017 to create your own budget. Be sure to include savings as a mandatory expense. Once you get in the habit of paying yourself first, you’ll see your account balances climb quickly.
Increase your contributions to your retirement plans.
Do you have access to a 401(k) or some other qualified retirement plan at work? Do you have some type of IRA? Are you maximizing your contributions to those plans?
If not, now may be the time to increase your contributions. Qualified retirement plans are useful because they are usually tax-deferred. Without the burden of annual taxes on growth, your funds can accumulate and compound at a faster rate.
Look at your budget to see how much you can increase your contributions. If your employer offers a matching 401(k) contribution, think about at least contributing enough to get the full match. You can also gradually increase your contributions over time, such as every few months. That way you can ease into increased savings levels, and you may not see a sudden shock to your budget.
Reassess your risk protection.
Even the most detailed and disciplined retirement plan can be undone by a costly emergency. An expensive medical procedure, a major home repair or even an extended period of unemployment can throw your savings plan off track. You may be forced to stop saving or even to take early withdrawals from your retirement accounts.
Instead, review your protection strategy. Do you have sufficient coverage to protect you and your family against death, disability, home damage and more? Do you have a sizable emergency reserve to cover out-of-pocket costs? If you’re nearing retirement, you may also want to consider long-term care insurance to protect yourself against costly assistance needs as you age.
Ready to get your retirement planning back on track in 2017? Let’s talk about it. Contact us today at Foote Financial Group. We can help you analyze your needs and develop a strategy.
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