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How to Set Up Your Retirement Savings in the Next Ten Years – 5 Quick Tips

October 12, 2020

How to set up your retirement savings in the next ten years is a very popular question.

As Generation X’ers are getting closer to retirement and millennials are aging into their 40’s, there are a lot of people that want to get into a financial position where they will be able to retire comfortably.

We teach you how to make effective retirement decisions and show you how to get started on your retirement savings plan. Work with a qualified instructor in a live class via Zoom. You can ask questions and even have a personalized lab (on Zoom) with your instructor after the class. Classes are held every month.

In the meantime, here are five quick tips to help you as you consider your retirement savings plan goals.


1. Determine how far you are from your retirement savings plan goals right now.

The first thing you have to do before you learn how to set up your retirement savings plan is to determine your current financial situation. This will tell you your starting point and how aggressive you need to be with your savings from now on. Take your time during this process and be sure to add the balances in your savings account, CD’s, stocks, bonds, 401(k) accounts, or any other retirement account.  The sum of all of these accounts will tell you where you are with your retirement savings and how far you have to go.

If you have an emergency savings account that you are holding for purposes such as home repairs, car repairs, emergency or medical bills, etc., do not count this toward your retirement savings plan. You never know when you will have to tap into these funds. The purpose of a retirement savings plan is to allow the funds to accumulate without touching them.

Also, if you are saving for a short-term goal like buying a car or holiday purchases, do not count the savings you have accumulated for these purchases.  This is money that will be spent, so it should not be included.


2. Don’t forget about other income sources.

Once you determine the current state of your savings, it’s time to estimate that other income sources that will be coming to you in the future.  This includes social security benefits. The social security administration offers a social security benefit estimator that is easy to use. Once you determine your future benefit, you may want to add this to your current retirement savings.

Another source of future income is an employer pension plan. Your employer should be able to help you estimate the amount of these future funds.  They will be a part of your retirement income and should not be forgotten.


3. Determine how much you’ll need after you retire.

How much are your monthly bills? If you keep the same lifestyle, how long will you need to keep it up? Be real when you ask yourself this. If you want to set up your retirement savings in the next ten years, ask yourself how many years you need to live off of it.  The longer you plan to live off it, the more aggressive you will have to be with your retirement planning.

As you are analyzing your monthly bills, you should also be planning to eliminate some of your debt. It is very important to control or eliminate high interest rate debt such as credit cards and short-term loans, so you do not take unnecessary monthly bills into your retirement years.

There are several things that can be done to reduce and eliminate credit card debt. If you have a high interest rate credit card, pay more than the minimum payment due. The more (and the more often) you can pay more the minimum due, the faster you will pay this debt off. If you have more than one credit card, consolidate the balances onto the one with the lowest interest rate, then pay more than the minimum due to pay it off quickly. If you are able to get credit card with 0% APR for a period of time, transfer your balances onto that card and pay it off during the time the interest rate is 0%.


4. Figure out ways to add to your savings.

There are several things you can do to add to your retirement savings plan including:

  • Using a trusted investment service to make good investments
  • Investing in stocks, bonds, mutual funds, IRAs, treasury bills, government securities, treasury notes, annuities, precious metals, etc.
  • Making sure you are getting the best interest rate for your savings accounts
  • Automating your savings with a round-up app
  • Automating savings options with your payroll department
  • Creating a new budget with savings as a focal point
  • Setting up auto deposit savings with your bank
  • Contributing more aggressively to existing IRAs and/or 401(k) accounts.
  • Working a part-time job

If you are trying to learn how to set up your retirement savings in the next ten years, then you are going to want to save as much as you can between now and then. Use every method you can and save as much as you can. It’s never too late, but the earlier you start, the better.


5. Work with a professional financial advisor.

Once you have an idea of how much you have saved, how much your monthly bills are, how many years you will have to live off of your retirement savings, and you have an idea on how to add to your savings, it’s time to work with a specialist.  Retirement planning includes math and emotions. We work with you to balance this process and keep things in perspective. We help you make sure the money will be there and you can have peace of mind and a smooth transition into your retirement.

Financial education is the biggest key to retirement success.  We give you the education you need to make sound decisions based on your specific retirement goals. We take the time to get to know you so you can have the kind of retirement that you want

Let a qualified retirement planning specialist at Arapaho Asset Management answer your questions, set you up with the right retirement savings plan, and teach you how to set up your retirement savings in the next ten years.