How to safe for retirement?

[SpendWisely]

Hi,
I started thinking about saving for retirement.
Does any of you have a practical advice on how to make yourself put money aside to save for retirement?

Thanks!

[bjl584]

That's a super broad question.
A more specific question will get you better answers, but it all starts with a budget. Figure out where every dollar goes, then be sure to pay yourself first. Put away X amount every pay day into savings or investing. Then, pay your bills. Then, live on the rest.

[Keshet]

Are you using a employer sponsored 401k? In that case contributions can be withheld from your paycheck automatically. If you're doing your own IRA you can arrange to have a regular contribution drafted from your bank acct on a monthly basis.

As bjl584 pointed out the key to financial planning is the budget.

[disneysteve]

First question is what options you have available to you.

Is there an employer retirement plan? Does it have a company match?
Are you eligible to contribute to a Roth IRA?

How old are you? How much do you earn? Are you married? Kids? Emergency fund?

If there is a company plan like a 401K and it has a match, best advice is usually to put in at least enough to get the full match. Then fund a Roth to the max. If you can do both of those things and still have more to invest, go back to the 401K.

Your goal should be to invest 15% of your gross (pre-tax) income for retirement not counting any company match.

[SpendWisely]

That's a super broad question.
A more specific question will get you better answers, but it all starts with a budget. Figure out where every dollar goes, then be sure to pay yourself first. Put away X amount every pay day into savings or investing. Then, pay your bills. Then, live on the rest.

It's a good strategy I think. Thank you.
I also heard that people put away like 10% of their income every month. With a rise in salary the monthly amount increases and so on.
I think I need to start with this.

[SpendWisely]

First question is what options you have available to you.

Is there an employer retirement plan? Does it have a company match?
Are you eligible to contribute to a Roth IRA?

How old are you? How much do you earn? Are you married? Kids? Emergency fund?

If there is a company plan like a 401K and it has a match, best advice is usually to put in at least enough to get the full match. Then fund a Roth to the max. If you can do both of those things and still have more to invest, go back to the 401K.

Your goal should be to invest 15% of your gross (pre-tax) income for retirement not counting any company match.

hi,
I'm not sure that my company has any retirement plans. They never mentioned it. It's worth to check though.
Thank you!

[jacklpalmer]

I'll put my insurance broker hat back on and say you should look into an HSA. It's like a IRA on steroids.

I wanted to submit a link, but for some reason the site isn't letting me until after I have 15 posts? Hmm..

Anyway, if you're relatively healthy, an HSA is a solid investment for retirement. You could also open a Roth IRA and double-down on the tax deductions - assuming you have the cash to put that much into them, that is.

[Captain Save]

What do you do?
How old are you?
What does retirement mean to you?
Do you plan on doing something you love that brings you income where you don't really feel like retiring. or do you want to clock out at 65 for the rest of your life? or better yet 50 yrs old?


All are questions that need to be answered before I would be comfortable telling you what you should do. Even then , it's stuff you should look into yourself. You are your best financial advisor. You just have to take it seriously.

[msomnipotent]

It's a good strategy I think. Thank you.
I also heard that people put away like 10% of their income every month. With a rise in salary the monthly amount increases and so on.
I think I need to start with this.

If you can only do 10%, then do 10%. If you can save more, that would be better. It depends on how old you are and how much you need for retirement, not a certain percentage of how much you have available today to save.

A subscription to Money or other magazine couldn't hurt, either. It is only $15 a year or less.

[disneysteve]

I'll put my insurance broker hat back on and say you should look into an HSA. It's like a IRA on steroids.

I think an HSA is fine, but should be 3rd in line after a 401k and a Roth IMO.

[jacklpalmer]

I think an HSA is fine, but should be 3rd in line after a 401k and a Roth IMO.

Hm, I disagree. I do a Roth IRA/HSA combination. Although I eventually end up funding both of them, I fund the HSA first. I like knowing that I have plenty of bread in there to pay for medical, dental and vision expenses tax-free. I can't do that with the IRA.

[Nutria]

I'll put my insurance broker hat back on and say you should look into an HSA.

But can't you only contribute to an HSA if you have a high-deductible health policy (and there's no indication that OP has a HDHP)?

[disneysteve]

But can't you only contribute to an HSA if you have a high-deductible health policy (and there's no indication that OP has a HDHP)?

Keep in mind that jacklpalmer is an insurance salesperson so that highly influences his posts.

An HSA is NOT primarily a retirement account. Yes, if you don't spend it all on healthcare costs, the money can be used in retirement, but it should not be your primary means of retirement savings. And, as you noted, you can only have an HSA with a HDHP which many people don't have access to.

Funding the HSA first is great for healthcare needs, but it should not be before or in place of retirement savings. It should be separate and in addition to retirement savings.

[Gailete]

I don't know how old you are or what kind of money you may be making now, but for some inspiration, tack pictures of homeless people, bags ladies and men around your home and office, to make you question each time that you want to buy a $5 coffee, that the difference with bringing coffee from home is about $4.50 that you could have put in a retirement account so that when the time come you too won't be a bag guy! Or they can be inspiration every time you want to go out and blow what should be going into a retirement account.

[Smallsteps]

But can't you only contribute to an HSA if you have a high-deductible health policy (and there's no indication that OP has a HDHP)?

I was thinking the exact same thing. I wonder how many policies are sold by pushing the HSA for retirement savings.
If all other options are being funded and a person just happens to have an HDHP then fine.