You know that you want to save for retirement. You may even have started to save some money in an IRA or 401(k) plan. But if you're like most Americans, you're still struggling to save enough for the future.
This is where money management comes in. Here are some money saving tips for retirement:
Pay off high-interest debt first. One way to reduce your long-term costs is to pay down your highest interest debt first — credit cards, car loans and other loans with high interest rates. This can save you hundreds or thousands of dollars each year in interest payments alone.
Don't buy stuff on credit cards. Credit card bills can add up quickly, and most people carry balances at least partially because they don't know how much they'll spend during the month. But carrying a balance on a credit card can actually increase your overall cost of borrowing because it increases your interest payments and makes it more difficult to pay off the balance before it balloons out of control. Instead, put cash down whenever possible when buying things on credit, whether it's a new pair of shoes or something else altogether (like paying off a few debts).
Track your spending. There are several ways to track your spending, including tracking what you spend on your debit card or credit card, or using a spreadsheet or online budgeting tool. If you don’t know where your money goes, then how can you possibly make sure that it will last until retirement?
Use a retirement calculator. These calculators will help you see what kind of returns (on average) you’ll need to get from your investments so that they match up with how much time is left before retirement age (when Social Security kicks in). They’re also great for seeing if there are any issues with your savings plan — for example, if your plan has too much risk or not enough growth potential.
Don't overspend during retirement! It's easy to get caught up in spending more than we should during our working years, but don't do that once we hit our golden years! Save as much as possible.