You already know that saving all you can for retirement is the best way to prepare for a more stable future. But for some people, it can be difficult to make room in the household budget to divert more money to savings. Try these six tricks to get your budget under control, and bump up your retirement savings. As you learn to think creatively with regard to money, you might find that the transition to retirement can be smoother than you had imagined.
Cut out late fees. Most of us miss a bill from time to time, but those late fees can really add up. Set aside time this weekend to organize your bills. Choose a smartphone app or even just an old-fashioned calendar. It doesn’t matter how you get organized; the point is to choose a system that you will use faithfully.
Adopt a healthier lifestyle. You might be amazed at how your health choices impact your budget! Healthier people miss fewer work days and incur less medical debt. Losing weight or quitting smoking can save you money on life insurance premiums, as well as future medical bills. Preparing healthy meals at home can save you money on restaurant meals. Exercising can reduce future medical bills, and obviously you’ll save money if you quit smoking or drinking. And these are just some of the ways a healthy lifestyle can impact your budget!
Save your tax refund. It’s tempting to spend a sudden windfall, but consider the value of a temporary thrill versus compounding interest over years. Stashing your tax refund in your retirement savings account each year is an effortless, but valuable way to bump up your savings.
Bundle your services. Gather your monthly bills and a calculator, and you might be surprised at how much you spend on entertainment items like phones, cable, internet, and other subscriptions each month. Your providers might offer valuable discounts on bundled services. You might also find that some of your subscriptions are rarely used, and you could cut them out entirely.
Take advantage of credit card perks. Excessive use of credit cards is obviously a bad idea, but some cards offer valuable perks like cash-back programs. Just remember that if you charge more than you can pay off at the end of the month, you aren’t earning any benefits. Some people use their credit cards for everyday purchases like groceries and gas, and pay the balance online each day. Then, they rack up cash back in the amount of 3 percent or more. When you manage the system correctly, it’s free money.
Update your retirement account contributions. Each year, the IRS establishes a limit for tax-deferred retirement contributions. But these amounts can change each year, so you should update your contributions periodically. You might as well stash that money in your retirement account, rather than paying taxes on it next spring! Give us a call for this year’s retirement plan contribution limits, and we can help you update your savings rate.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.
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