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Every year resolutions are set in late December or early January and by February almost all of them are by the wayside. American’s continue to struggle to save more and spend less each year. Fiduciary financial advisor Thomas Reilly of Strategic Wealth Designers joined the newscast to highlight 3 ways you can actually stick with saving money throughout the year to build up that retirement plan you have started. He’s the first key is to get into the mindset of paying yourself first.
“Too often the bills are due, the kids need new shoes or your want to purchase tickets to your favorite sporting event,” Reilly says. “Instead of looking at what you are buying or paying for, retrain your mind to ‘pay yourself first’. Maybe that starts out as just $100 a paycheck. Over time, move that up to 5 or 10% of every paycheck. Take the money right after you’ve been paid and put that in a savings account or an investment account. Once you’ve paid yourself, then you can start assigning the rest to bills or discretionary purchases.”
Another source of saving that goes by the wayside every year in the form of billions of dollars, is the employer match. Most companies offer their employees some form of 401K or SEP IRA or company stock investment option. Anywhere from 1% up to 8% could be matched by an employer based on the employees contribution. Reilly says you must take advantage of free money when presented.
“There’s no other investment that is going to guarantee a 1 for 1 return, like an employer match,” Reilly says. “It’s free money that you’ve been given the opportunity to cash in on, but every year billions of dollars are lost because employees don’t make a contribution. If you don’t understand how investment plans through your employer work, talk with your HR contact or seek professional advice from a financial advisor to ensure you build up your retirement account by taking advantage of what the company matches.”
The final way to ensure your investments and your savings grow at a quicker pace is to not buy anything you can’t pay cash for. It can be difficult to refrain from buying the next shiny toy or taking a big trip but for the future of your retirement, it is wise to wait if you can’t pay for it with cash. To see additional stories surrounding business and economic news for the Denver area, visit https://KDVR.com/Money and if you have a question for Thomas send an email to email@example.com.