In these tough economic times, many people have been laid off, experienced reduced hours, or struggled to keep their businesses afloat due to the COVID-19 pandemic. Whether you’re nearing retirement age or you’re just getting started in your career field, planning for the future is critical in these uncertain economic times. Financial planner Anamika Madan is working to provide financial tips to help people build up their retirement funds, even when times are tough.
Tip #1: Make a budget – and start saving.
It’s easy to think that you’ll save money and stick to a budget that you’ve set in your mind, but writing it down on paper (or using an app or software program) makes it real. Anamika Madan recommends being realistic about your finances. Know how much you’ll need per month in your retirement, and start making steps toward that goal. Take steps to cut down on debt, but be careful not to cut yourself short. You may need to revisit your budget for the first month or two, and this is normal. Getting a handle on how much you actually need (and how much you can save) can take some time, according to Anamika Madan.
Tip #2: Make it automatic.
Anamika Madan recommends setting up an automatic deposit into your retirement plan each month. While you can always cancel the transfer if you need to, it can be easier to build savings when you don’t have to think about it. If you work for a company and get a regular paycheck, decide what percentage of that check you can put into savings each month. Talk with your human resources office about retirement options available to you, and start having money placed in the account each month, if you haven’t already. Anamika Madan recommends taking advantage of matching contributions and contribute the maximum to these types of accounts if you can.
Tip #3 Check your account regularly – and don’t be afraid to make changes.
Sometimes, it can be easier to ignore financial issues than deal with them, especially when it comes to retirement funds, according to Anamika Madan. This can cause major financial problems. Anamika Madan says that getting into the habit of checking your retirement account regularly can take away the anxiety associated with money, and can help you to build better financial habits.
Knowing what you have (and what needs to change) can make all the difference when it comes time to enjoy your golden years. Anamika Madan recommends being patient with yourself, especially if you didn’t grow up in a home that prioritized saving for retirement. Learning new financial habits can take some time, but it will pay off in the long run.
