Your Top 10 Ways to Save For Retirement Now

Your Top 10 Ways to Save For Retirement Now

No matter what age you are, if you haven’t already started saving for your retirement years, now is the time to start.

If you’re young, you have the savings advantage of time. Saving for retirement may seem like a strain on your budget right now, but you can start small and grow. Even setting aside a small portion of your paycheck each month will pay off in big dollars later. By starting young, you also can afford to invest more aggressively since you have years to overcome the inevitable ups and downs of the stock market.

Developing the habit of saving for retirement now will make it easier to continue saving throughout your working years. If you put $1,000 into an individual retirement account (IRA) each year from age 20 to age 30 (11 years), and the account earns 7 percent annually, you will have $168,514 in the account when you retire at age 65. But if you don’t start until age 30 and then save $1,000 each year for 35 years straight earning 7 percent annually, your account would grow to only $147,913.

If retirement is just around the corner and you haven’t saved enough, it’s not too late. There is still time for you to add to your retirement savings. You may need to rearrange your budget and your spending priorities so you can funnel those savings into your retirement plan. You may need to retire a bit later than you’d originally planned on, but that will give you the extra time you may need to increase your savings.

No matter what stage you’re at, the key is to get started. There is no time to wait or to waste. The more you save now, the better off you will be when you get there. And as you’re getting started, here are ten of the top ways to save for retirement now.

Save For Retirement Now

  1. 1. Know Your Retirement Needs

Retirement is expensive. Experts estimate that you’ll need about 70 percent of your pre-retirement income (90 percent or more for lower earners) to maintain your standard of living when you stop working.

  1. 2. Find Out About Your Social Security Benefits

Social Security pays the average retiree about 40 percent of pre-retirement earnings. Call the Social Security Administration at 800-772-1213 for a free Social Security Statement. Find out more about your benefits at

  1. 3. Learn About Your Employer’s Pension Plan

If your employer offers a plan, check to see what your benefit is worth. Most employers will provide an individual benefit statement if you request one. Before you change jobs, find out what will happen to your pension. Learn what benefits you may have from previous employment. Find out if you will be entitled to benefits from your spouse’s plan. For a free booklet about protecting your pension, see the Department of Labor’s article What You Should Know about Your Retirement Plan.

  1. 4. Contribute to a Tax-Sheltered Savings Plan

If your employer offers a tax-sheltered savings plan, such as a 401(k), sign up and contribute all you can. Your taxes will be lower and your company may kick in more. Automatic deductions from your paycheck make it easy. Over time, compound interest and tax deferrals make a big difference in the amount you will accumulate.

Ways to Save For Retirement Now

  1. 5. Ask Your Employer to Start a Plan

If your employer doesn’t offer a retirement plan, suggest that it start one. Simplified plans can be set up by certain employers. Read about IRAs in Publication 590 on the IRS website.

  1. 6. Put Your Money into an Individual Retirement Account

You can put up to $5,500 a year ($6,500 if you are age 50 or older) into an Individual Retirement Account (IRA) and gain tax advantages. When you open an IRA, you have two options: a traditional IRA or a Roth IRA. The tax treatment of your contributions and withdrawals will depend on which option you select. The after-tax value of your withdrawal will depend on inflation and the type of IRA you choose.

  1. 7. Don’t Touch Your Savings

Don’t dip into your retirement savings. You’ll lose principal and interest, and you may lose tax benefits. If you change jobs, roll over your savings directly into an IRA or into your new employer’s retirement plan.

  1. 8. Start Now, Set Goals and Stick to Them

Start early. The sooner you start saving, the more time your money has to grow. Put time on your side. Make retirement savings a high priority. Devise a plan, stick to it and set goals for yourself. Remember, it’s never too early or too late to start saving. So start now, whatever your age!

  1. 9. Consider Basic Investment Principles

How you save can be as important as how much you save. Inflation and the type of investments you make play important roles in how much you’ll have saved at retirement. Know how your pension or savings plan is invested. Financial security and knowledge go hand in hand.

  1. 10. Ask Questions

These tips point you in the right direction, but you’ll need more information. Talk to your employer, your bank, your union or a financial advisor. The experts at Roper Insurance will be happy to help you get moving in the right direction. You can contact Roper Insurance here. Ask questions and make sure you understand the answers. Get practical advice and act now. Financial security doesn’t just happen—it takes planning and commitment and, yes, money.