As the cooler fall weather arrives, it’s a great time to reflect on your financial goals.
Whether you are planning for retirement or have another long-term goal in mind, your financial well-being has a big impact on your stress levels and overall quality of life. Take time to invest in yourself this season before the rush of the holidays and the temptation to overspend on gifts.
According to the U.S. Census Bureau, less than half of Americans own retirement accounts — just 47.8% of men and 43.5% of women. Baby boomers (56-64) are more likely to have a retirement account with an ownership rate of 58.1%, while young adults considered Gen Z (15-23) are least likely with 7.7% saving for retirement.
If you have a child or grandchild with a part-time or full-time job, encourage them to find out if their employer offers a 401(k) matching program or other retirement account. They may be surprised to learn they can benefit from their employer matching their own contributions and begin a life-long habit of saving.
It’s never too late to start.
While how much you’ll need to save for retirement varies, you can get a better idea and start mapping out a plan of action using the free resources your local financial institution offers. For example, interactive retirement calculators can help you compare individual retirement account options and determine how long retirement savings will last.
If you have children, you may need to focus on multiple long-term goals at once to ensure you’re saving enough for your own golden years while helping your children with college costs or other expenses. Your local credit union may also offer additional financial planning resources to help you balance those goals.
Here are a few simple steps you can take today to help you prepare for the next stage of life, whenever and whatever it may be:
Review spending closely
If you feel like the money is spent as quickly as you earn it, you’re not alone. The good news is that it is much easier to spot opportunities when we look closely at our spending habits. For example, could higher-rate loans be consolidated to decrease monthly payments and get out of debt sooner? Are there some expenses that could be done away with altogether? Many memberships or subscriptions automatically renew, making smaller monthly costs easy to forget about.
Make saving automatic
Once you carefully examine where your money goes, you will likely find at least a few items that can be consolidated or trimmed out of your budget. This leaves room to save, even a modest sum, on a regular basis. Your local financial institution and employer can help set-up an automatic payroll deduction to ensure that you are paying yourself first by directing a portion of your paycheck into a savings account. Any amount going into savings is better than none.
Build a long-term plan
After you establish a steady savings habit, you’ll want to look at other options that can help you earn more as your nest egg grows. Check with your local credit union or bank to see if they offer higher-yielding savings options that are still federally insured or provide free consultations with financial advisors on-site. A trusted financial partner can help you understand the different investment options available to you and develop a plan that can help you reach your retirement and other long-term goals.
Saving for retirement may seem daunting but taking the first step today can make a huge difference down the road. You may be surprised by how quickly even small changes in your spending habits can add up. Here’s to a more comfortable retirement and secure financial future.
Marc Prasch is chief member experience and operations officer at Abound Credit Union.
Marc Prasch is chief member experience and operations officer at Abound Credit Union.
