Saving for retirement requires a focused approach to your present day, finances in order to ensure the success of your future finances.
Maximizing your retirement savings as quickly as possible allows time to be on your side: time to weather market volatility and time to get compound interest working for you.
The Goal: Maximizing Your Contributions
Maximizing your contributions to both work and individual retirement plans allows funds to be invested and grown either tax-deferred or tax-free with compound interest working on your side.
Steps to Take: Paying Off Debt
Paying off consumer debt such as credit cards, car loans, student loans, medical bills, etc. will allow your income to go towards retirement savings, not bank and loan payments. Your greatest asset building tool is your income and removing debt payments allows it to go work productively.
Steps to Take: Emergency Fund
Setting aside three to six months of expenses is a solution not only for unplanned emergencies but also for peace of mind and security. This step allows income to continue going towards retirement savings even if an unplanned situation occurs.
Steps to Take: Protecting What Matters
Setting up insurance policies transfers personal risks you simply cannot afford to take. This includes life insurance to provide for your family, disability coverage and long term care needs both to protect against unforeseen emergencies depleting or removing income.