It’s an age-old belief that you need to save for retirement with every paycheck, but it’s all too easy to let retirement planning fall to the wayside. There’s always something more important that needs to be paid off: an upcoming vacation to save for, an impulse buy, etc.
However, retirement can creep up on you before you know it. It is more important for you to save now than to deal with the stress that comes with poor planning. You don’t want to be caught in a lurch and have to work extra years simply because your retirement fund wasn’t as full as you wanted it to be.
The key is to save money without even noticing it has left your account, and the following tips and tricks can help you do just that.
Change your mindset
Focus on saving with your very next paycheck. Do not dwell on whether you’ve saved anything up until now, as there is nothing you can do about that. Start with a blank slate and a clear mindset when it comes to saving, so forget about the past and only focus on what you can do now to help you reach your goals.
Match your restaurant bill
Every time you go out to eat, match what you spend and put it in your retirement fund. Or, if you don’t go out to eat, choose another activity you frequent such as going to the movies or going out for a drink on Friday.
This means that if you spend $50 on dinner, you should transfer an additional $50 into your savings that night. Doing so not only allows you to save extra money easily, but you can adequately budget for frivolous expenses, since you’ll have to budget twice what you’re used to.
Focus on one loan at a time
You want to reach retirement with as little debt as possible, but it can be hard when you’re overwhelmed with a bunch of different loans. In order to make the payment process less stress inducing, focus only on paying back one loan at a time.
Going at your payments one by one can make the mountain of debt seem reasonable. And when you do this at a consistent pace, you’ll be more likely to head into retirement debt free.
Automate your savings
You don’t even have to see your savings every week when you have automatic payments. Simply set up for your bank to take a percentage of your paycheck every time you are paid and you won’t even notice it is gone.
If you don’t know where to start, try saving 10 percent automatically off of your gross pay. It is also a good idea to automatically set up payments for a 401k investment account this way, so you’ll have the beginning of a good-sized nest egg.
Avoid spending your raise or bonus
Everytime you get a raise or a bonus, consider putting the entire amount into savings. While it is okay to reward yourself for work well done, saving this extra income will come more in handy down the road. Consider this: if you put this new chunk of change into a regular investment account, you can expect to gain interest on it later down the line, without even noticing the money is there.
These small money saving tips and tricks will go far in creating a great retirement savings account for you down the line. Remember, if you start now, your future self will thank you and you’ll be on the way to enjoying a wonderful retirement.