Do you have kids? Do you have plans for your kids to go to college one day? Have you looked at how much college is going to cost you for just one kid? College is a big investment, but it is a good one. If you begin planning for this huge expense when your kids are young, you won't take much of a hit when the day comes that your teen packs his or her bags and heads off to start a new life at school. This blog will provide you with several ideas and tips that can help you find ways to plan for your kids' college tuition.
You have a set amount of money deposited into your employer backed 401(k) program every month. In fact, you've done this for more years than you can count and it seems to be working, so you're all good. The reality is that you might be doing yourself a disservice. Getting the most out of your retirement savings plan requires a far greater effort. Make sure you know what to do.
Always Contribute The Max
If you have room in your budget and you're not contributing the maximum amount your employer will match to your account, you aren't getting the most out of your retirement. When you fail to do so, you're are basically passing up free money that will come in handy once you're retired and living on a fixed income.
If you don't know the maximum that your employer will match, contact a human resources representative to get this information and immediately up your contribution to meet this amount.
Don't Rely On Early Withdrawals
Make sure you aren't relying on early withdrawals in the event of an emergency. Sure, in the event of a major issue you can withdrawal money from your account to help ease the burden. However, this option should only be considered when you have exhausted all your other options.
Early withdrawals come with significant penalties and tax payments. A better solution is to also maintain a personal savings account apart from the retirement savings that you can tap into should an emergency arise.
Make Sure You're Using The "Catch-Up" Feature
In a perfect world, you can start savings in your 20s, but this isn't always the case. If you are over the age of 50 and you just started contributing to a 401(k) plan, make sure you are activating the catch-up feature. All 401(k) plans have a maximum amount that you can contribute each year. However, when you are over the age of 50, and you have not been consistently contributing to an account, this feature allows you to contribute more than the maximum.
The ability to contribute more allows you to save more aggressively over a short period of time since you will likely be retiring soon.
Make sure you are maximizing the benefit of your 401(k) retirement savings plan. If you are having trouble, a savings management professional like those at Gosho Financial Group can review your account and help you make changes that will ensure you get the most out of your investment.
Share21 February 2017
