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Investing & Retirement

2 Secrets to a Confident Retirement

4 Minute Read

Does the thought of retirement leave you with a sinking feeling in the pit of your stomach? If so, you’re not alone. Retirement took top billing in a recent Gallup poll of financial concerns, with 59% of Americans worried that their nest egg will fall short.

Your golden years have the potential to be the best of your life. Don’t let fear sidetrack your dreams. If retirement stress is getting you down, take heart—then take control with these two steps.

Secret 1: Get In the Game

Every sports fan knows you can’t score points from the sidelines. Sure, there’s no risk of injury or embarrassment when you’re a spectator—but there’s also no opportunity for glory. If you want to win, you’ve got to get off the bench and in the game!

Retirement’s no different. Choosing to stay out of the stock market because you can’t predict its every move—or don’t know all the plays—is a sure way to end up with a goose egg in your golden years. According to the Employee Benefit Research Institute, workers who participated in a retirement plan were more than twice as confident in their ability to retire comfortably as those with no plan at all.

Knowing your retirement options shouldn’t be hard. Let us help you.

So stop worrying and start investing! Just make sure you’re debt-free with three to six months of expenses in an emergency fund first. You’ll get the most bang for your investing buck when you free up your biggest wealth-building tool—your income.

Secret 2: Give It Your Best Shot

With so many factors to consider, getting retirement right can feel like trying to make a half-court shot at the buzzer. Do you have the right mix of funds? Are you receiving the best rate of return? Should you get professional advice?

Don’t get so caught up in these details that you overlook the biggest win of all. A recent study in the ASPPA Journal found that retirement success depends more on your savings rate than anything else. That’s great news! Why? Because it means you’re in control of your own destiny. The more money you put in, the better you’ll feel about your future!

Dave recommends investing 15% of your income, because it allows you to build a secure tomorrow while still enjoying life today. Here’s how it works:

—Start with your employer’s 401(k) or other company plan and invest enough to get your match. If your employer offers a Roth 401(k) with good, growth stock mutual fund options, you can invest your full 15% in the Roth 401(k).

—Above the match, fund a Roth IRA. If your employer doesn’t offer a match, skip the 401(k) and start with a Roth IRA.

—For 2014, you can contribute up to $5,500 ($6,500 if you’re 50 or older) to a Roth IRA. If you reach your Roth IRA limit but still haven’t invested your full 15%, invest the remaining amount in your 401(k).

If you can’t invest 15% out of the gate, that’s okay. Start somewhere and increase your contributions gradually over time. An experienced financial advisor can help you set your target and show you what it takes to get there.

You Can Do It!

Success doesn’t happen overnight. It takes courage to get in the game and discipline to stay in it. Be sure you have a pro you can trust on your team in case you need an extra boost of motivation along the way. The right advisor will keep you focused on the end goal, no matter what’s happening on the sidelines.

If you don’t know where to begin or have questions about your options, we can connect you with an advisor who has the heart of a teacher in your area.

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