It’s not as hard as it sounds. For many people, the million-dollar mark is a goal that represents security and peace of mind. Apply the tips in this guide, and you’ll be well on your way to make your million in retirement savings.
1. Never miss your employer’s match
It sounds simple, but time and time again we discover clients who are not taking advantage of the full matching contribution from their employer. From your first orientation at your new job, you should find out what the matching contribution rate is. As a wise investor, you start contributing to your 401(k) plan with your first paycheck.
One of the most common way to miss out on your employer’s matching contribution is neglecting to raise your contribution after an annual raise. This is essentially throwing away free money! Follow the advice in Tip #4 below instead.
2. Start young or max out your yearly 401(k) contributions
Everywhere you go you’ll see advice to start contributing while you’re young. Makes sense, but what if you’re not so young anymore? In that case our advice is to max out your yearly contributions to your retirement plan. Talk to us about the annual maximum and the special “catch-up” provision if you’re over the age of 50.
3. Invest in only a full-disclosure environment
Accept nothing less than full transparency in your financial advisor. When you choose a fee-only fiduciary advisor and Certified Financial Planner (CFP)™ such as Keegan Denn, you ensure the highest level of transparency and accountability. You get low-cost investment options and benchmarked, appropriate fees.
4. Increase contributions, not cost of living
When you receive a raise, the first order of business is to increase your contributions. Employees who continually increase their cost of living forego the opportunity to leverage the power of early contributions. Live below your means, not above them.
5. Invest in predictable, long-term investments
Don’t make the mistake of investing heavily in the latest trend only to lose the critical 401(k) funds that will support your future. Numerous clients have come to us for the first time after a series of volatile investments failed. FIDELIS iM has a reputation for disciplined, well-balanced, diversified investments that drive the long-term results you want. We use a unique, strategic matrix for asset allocation based on your risk tolerance, growth expectations, and investment horizon.
Will $1 million be enough for your retirement? The million-dollar mark may be a common goal, but each individual will have numerous considerations that may necessitate a higher or lower goal. For more information, read our guide, Six Steps to Financial Success.
Studies show that most Americans are currently behind on reaching their retirement goal. So don’t delay! Log in to your retirement account today and increase your contributions. If you have any questions, please feel give us a call to see how we can maximize your chances of reaching your retirement goals and possibly help you join the million-dollar 401(k) club.