Saving for retirement is a long and complicated process for most of us that takes many hours of planning and requires your follow through on those plans. In order to create a comfortable retirement for yourself after your career is over, you will need to create a comprehensive plan long before you plan to retire and stick to it. Here are a few tips to get you started on saving for that house on the beach:
•Start as soon as possible. Many young people make the mistake of thinking that retirement planning is a waste of time. The truth is, the sooner you start thinking about it, the easier it will be to put money aside for when you really need it and you stop working.
•Think of your savings as an expense. With all of the regular expenses we face in everyday life, such as rent, food, and utilities, it’s very difficult to put anything into savings on a regular basis. The best way to avoid spending your retirement money is to think of your regular additions to your savings accounts as another expense, similar to paying your car loan or rent.
•Use tax-deferred accounts. Putting your retirement savings in a tax-deferred account acts as a mental block from spending that money on an impulse. Money in tax-deferred accounts cannot be spent without tax consequences and penalties. All assets in tax-deferred accounts cannot be spent before the age of 60 without incurring an early distribution penalty.
Gary Kapanowski, a professional accountant with years of experience, stands by these pieces of advice.
Tagged: Gary Kapanowski