If you look at your savings progress and think, “How will I ever afford to retire?” you don’t need to worry just yet. Thankfully, we can all take steps to improve our saving power! Noticeable, nerve-calming progress is within your reach.
If you feel behind on your retirement track, consider making these three adjustments to your financial habits:
- Make a Timeline: If you have not done so already, create a clear visual log of your savings progress, including the year you would like to retire. Consider using a planner, calendar, or other organizational tools to your advantage. This is also a good time to crunch numbers: a sustainable retirement nest egg should last for the remaining years of your life after you retire. Be sure to factor in the anticipated cost of living in your desired retirement location as well as the rising cost of interest. Estimate how much you would need to save each month over a thirty-year period versus a twenty- or forty-year period. This breakdown will give you a better sense of whether you are saving enough each month. The general rule of thumb is, of course, to save as much as you can.
- Pay off Debt: As soon as you can, pay down the debt you’re currently in. This way, you won’t lose money to interest that you could otherwise put toward your goals! It is also advisable to put a pause on getting yourself into more debt until your overall balance is manageable.
- Find (or Create!) More Savings Power: Look for places in your monthly budget where you can reduce what you are spending on your necessities. Strategic spending can open up savings funds you didn’t realize you had! Alternatively, if you feel like there is no room in your budget for saving, increase your saving power by increasing your income. For example, if you decide to start a second career, even in the short term, you are increasing your savings potential. Extra income can shave significant time off your retirement schedule.
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