Today, the main vehicle many people have to save for retirement is through their employer-sponsored retirement plan. It’s also not uncommon for investors, particularly couples, to have two or more workplace retirement plans, along with an array of other savings vehicles.
It’s important to maintain a holistic view of your finances, creating a savings and asset allocation strategy that incorporates your entire portfolio. Consider the following five points when reviewing and taking charge of your retirement savings:
1. Invest as Your Income Increases
If you receive an increase in income such as a salary increase, company bonus, tax return, or a reduction in expenses such as paying off a car or a loan, it’s a great time to put those extra dollars toward retirement savings.
2. Consolidate Assets
If you still have retirement funds from previous employers, consider consolidation by rolling those funds into your current company’s retirement plan. Having all of your retirement assets in one location may help simplify retirement investing and income planning.
3. Reduce Taxable Income
The money you contribute to your employer-sponsored retirement plan is not included in your current taxable income. By the time you begin to withdraw money at retirement, you may likely be in a lower tax bracket. For your retirement savings, consider maxing out your tax-advantaged options before investing in taxable accounts. (Some plans have a Roth feature, and if you are utilizing this, you will pay current taxes but will not pay taxes at the time of distribution).
4. Review Your Investments
Take advantage of all of the resources available to you, including meeting with your retirement plan consultant or financial advisor. Also, utilizing online calculators, such as those at wealthadvisors.com, is a great place to start tracking your retirement savings for your household, no matter what age you are.
5. Staying Front of Mind
Scheduling an annual check-up with your retirement consultant or financial advisor will help you ensure that your investments are matched with your risk tolerance, and help you stay on track with your overall retirement goals.
Aldrich Wealth LP helps our clients protect and grow their financial assets for the future, by helping them make smart decisions today. If you would like assistance in determining your retirement needs, please call Aldrich Wealth at 888-299-3102 to speak with a financial advisor.