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1. |
Participate in your employer’s retirement plan.
Participating in your plan is the first step to saving for retirement. Putting your savings
under the mattress simply won’t work if you’re going to beat inflation and live the life you
choose in retirement.
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2. |
Take advantage of any plan match.
Many employers match part of your contributions. If you’re not contributing the full amount
your company matches, you’re missing out on money your employer wants to add to your retirement
savings.
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3. |
Save as much as you can.
You save on current taxes with every dollar you put into the plan. So if you’re contributing
less than you can afford to, you’re passing up both retirement savings and current tax savings.
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4. |
Invest for the long-term.
A common rule of thumb is to subtract your age from 110. That’s the percentage of your investments
you should have in stocks or stock mutual funds. If you’re investing too conservatively, you
may not save enough to meet your retirement goals.
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5. |
Diversify within stocks.
Do you have a mix of stock investments in your retirement savings? Choosing more than one type
of stock or stock mutual fund can help reduce the risk of loss in any single year, while
providing an opportunity for attractive average annual returns over the long term.
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6. |
Avoid frequent trades.
No one can predict the market’s next change. And moving your money too often can keep you
from earning the long-term benefits of your strategy.
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7. |
Let your investments grow.
Loans and withdrawals are sure-fire ways to derail your retirement goals. They take money out of
your account, so you lose the compounding. You also may have to pay yourself back with
after-tax money.
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