5 (Nearly) Foolproof Ways to Fill Your Retirement Fund

Your financial stability and taking care of your family should be top priorities regardless of your age. For those who are nearing retirement — or wanting to plan well ahead — there are simple steps you can take to help preserve your financial stability when the time comes for you to retire. The good news is that when you plan ahead and ensure that your family is taken care of, you can fully enjoy your retirement when it comes.

The cost of living is getting higher, and when you're retired, you're living on limited income. That’s why allocating financial resources for your retirement is essential. Once you leave full-time employment, you don’t want to worry about where you'll get money to pay your bills and daily living expenses. For most people, having a healthy savings account isn't nearly enough. With that in mind, here are five tips to help you save more for retirement:

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Tip #1: Increase Your 401(k)

Many companies will match a percentage of an employee’s 401(k) plan contributions — some even match your contributions dollar for dollar! Slowly increase the amount you're putting into your retirement funds with each paycheck, and you’ll reap more benefits from your company’s match. One perk of your 401(k) is that it's basically tax free until you're retired. This way, you aren't paying taxes or interest on the funds you accumulate until you begin to receive payouts.

(Note: Matching contributions from your employer may be subject to a vesting schedule. Consult with your financial advisor for more information.)

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Tip #2: Open a Line of Credit

While it seems counterintuitive to take out a loan or line of credit to help boost your retirement funds, it’s actually a viable way to save money. By taking out a HELOC (home equity line of credit), you can pay for home upgrades, health care or other expenses without tapping into your retirement accounts. This way, you won’t pay hefty fees for taking out your retirement funds early — ideally, you’ll pay off the HELOC before retirement. This strategy may not be appropriate for everyone, so be sure to speak with your financial advisor before taking out a HELOC.

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Tip #3: Consider Traditional & Roth IRAs

Even with Social Security and 401(k), you may not have enough cash to last you through retirement. Traditional and Roth IRAs (individual retirement accounts) offer another way to save money for retirement. You can contribute a total of $6,000 annually (+$1,000 more if you are age 50 or older) to your IRA accounts. The main difference between the two is that a Traditional IRA is funded with pretax dollars, while Roth IRAs are taxed up front. One major benefit of the latter is that you don’t have to worry about increasing tax rates, since you’ve already paid taxes on the money you deposit.

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Tip #4 Increase Your Monthly Saving Goals

If you're following the 50/30/20 rule and are meeting your savings goal of 20% of your income, you're doing great. But if you can find ways to cut back on your spending money on a monthly basis, you should absolutely do so. Some suggestions include:

  • Dining out less often
  • Create a habit to dedicate a portion of each paycheck to retirement planning. Have this amount transferred from your checking account to savings.
  • Budget well and don't spend past your limit
  • Use coupons and look for savings on items you buy regularly at grocery stores
  • Take some of your unneeded clothes and household items to a consignment shop
  • Replace credit cards with rewards cards that have a lower interest rate

There's always something you can cut back on or ways that you can save more each month. It might not seem like much money now, but the earlier you start, the more you'll put away toward your retirement savings.

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Tip #5: Use Your Financial Advisor as a Guide

An experienced financial advisor can be beneficial when you’re designing your personalized retirement plan. They have the expertise to help you and your family create a budget that fits your needs and lifestyle in the long term. From helping you choose retirement accounts to finding creative ways for you to increase contributions, a financial advisor can guide you through everything you need to know about retirement planning.

What it Means in the Scheme of Things

Retirement savings are imperative to your financial stability and success once you're no longer working full-time. Our five simple tips can help you plan for your future and help ensure that your golden years are comfortable.

Remember, there's no "perfect time" to start saving for retirement; you can begin at any age. By thinking ahead, you’ll be more likely to be able to relax and enjoy your retirement rather than worrying about whether or not you have enough money to carry you through.

If you’re ready to get started, or you want to have a professional look over your current retirement assets, a Raymond James Financial Advisor can help! Contact us to set up a free appointment today. We’ll work with you to customize your retirement plan so you can have financial confidence and enjoy your Golden Years.

Are you retirement ready?


The material presented here is for educational purposes only, and is not intended to be used as financial, investment, or legal advice.

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Holding investments for the long term does not insure a profitable outcome. Investing involves risk and you may incur a profit or loss regardless of the strategy selected.

Roth IRA owners must be 59½ or older and have held the IRA for five years before tax-free withdrawals are permitted. Like Traditional IRAs, contribution limits apply to Roth IRAs. In addition, with a Roth IRA, your allowable contribution may be reduced or eliminated if your annual income exceeds certain limits. Contributions to a Roth IRA are never tax deductible, but if certain conditions are met, distributions will be completely income-tax-free.

401(k) plans are long-term retirement savings vehicles. Withdrawal of pre-tax contributions and/or earnings will be subject to ordinary income tax and, if taken prior to age 59½, may be subject to a 10% federal tax penalty.

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