Attempting to save for retirement can feel like pushing a large boulder up a steep slope. If this sentiment becomes more apparent as the retirement years approach. You aren’t alone. Numerous Americans claim to have no retirement savings and are anxiously searching for solutions to increase their finances.
Whether you’ve been unemployed, lacked access to a retirement plan, or simply need to catch up, there are twelve measures you may take if you have no retirement savings.
Obtain a glimpse of your current financial situation.
Life can come at you quickly, making it difficult to know how much money you have at any given time.
- Set aside time on your weekly calendar to evaluate your household’s income and expenses.
- What upcoming expenses do you anticipate?
- Sometimes an emergency can be prevented by addressing maintenance issues before they worsen.
- Budget more prudently.
Over a week, a month, or even an entire year, a night on the town can add up quickly. Consider if a night out at your favorite restaurant costs $50, you could transfer $250 per month to your retirement account by not dining out five times per month.
Eliminate high-interest debt
If you have no retirement savings, you likely have high-interest debts blocking up the retirement pipes. Between 2018 and 2020, Americans paid over $120 billion in interest and fees for credit cards, according to the Consumer Financial Protection Bureau. Ouch.
You may be aware of the monthly payments for each credit card, but do you also know their respective interest rates? Take some time to review your credit card interest rates. Then, start looking for innovative strategies to eliminate your debt permanently.
Don’t overlook bonuses.
A bonus from work seems like an opportunity to remove those enjoyable products from your Amazon “Save for Later” list. However, since the bonus is effectively money you do not yet possess, it cannot be missed if transferred to retirement.
Send all bonuses, whether they are annual or quarterly, to your retirement account so they can increase over time.
Check work benefits
If your employer is willing to match your retirement contributions, that’s more free money.
Not certain of your benefits? Most likely, your job includes an HR portal where you may access company-wide perks, such as retirement matching. They will probably not match your donations, but every dollar helps.
Take advantage of promotions to save for retirement.
Promotions are often accompanied by a pay increase, another unexpected income. Finally, the story twist is in your favor. You can transfer additional funds to your retirement account without sacrificing your quality of life. If you wish to pinch a bit harder, you can do so without causing too much pain in the long run.
Utilize roundup applications to increase savings.
Acorns, Guac, Digit, and Betterment all collect money that would otherwise be lost to purchasing. If you swipe your debit card, you might as well swipe it with intention.
While the money must still make a few hops before reaching your retirement account, these roundup programs allow you to save money that you might otherwise spend.
Permit relatives to maximize retirement accounts.
Did you know that you can contribute monetary gifts to your Roth IRA (provided that you meet the regular requirements)? Not everyone has eager family members, but it doesn’t hurt to inquire if yours is willing to pitch in.
Some people find it hard to have personal conversations about money with their families. But it’s better to risk a few moments of awkwardness instead of sitting up at night worried about your retirement.
Invest in a side business.
To fund your 401(k), you may need to take on a part-time or side job if you wish to save for retirement. This might involve Uber, DoorDash, or any legal methods of earning extra money.
Consider how you can assist others, and you may discover that you can save the money you earn on the side for your retirement.
Let robots facilitate retirement.
By automating your savings and retirement, you can ensure that your money is put to work for you before you spend it. With an IRA or 401(k), set up automatic retirement contributions.
Open an IRA
It is feasible to make contributions to both IRAs and 401(k)s (k). The IRS permits people to use both retirement accounts, with certain restrictions. There is a distinction between the ability to contribute and the ability to deduct contributions on a tax return.
Be aggressive with your investments.
Many people in their 40s and 50s who are trying to catch up on their retirement funds make the error of playing it too safe. Conservative portfolios prioritize capital preservation, although capital growth is the primary objective.
The optimal investment portfolio prioritizes growth, which means equities. Bonds are useful for capital preservation, while equities offer the highest returns.
Bottom line
If you haven’t saved anything for retirement, it’s normal to feel irritation, guilt, and grief. However, if you concentrate on what you can manage, you’ll discover that you have more options than you anticipated and be able to eliminate your financial concerns.
Be inventive. Start viewing your world in terms of both what you produce and what you can save. The more you search for retirement solutions, the more money will flow to you.