The Easiest Ways to Start Saving for Retirement Now

Retirement planning written on a notepad

Saving money for your nest egg doesn’t have to be an overwhelming process. |

Saving for retirement often gets put on the back burner. It’s hard to plan that far ahead, and because of this, many Americans get to retirement age without enough money. According to a 2016 study by Transamerica Center for Retirement Studies, only 38% of people call themselves habitual savers, and 23% of people save for retirement only occasionally, meaning a large portion of the population isn’t setting much money aside for themselves at all.

This doesn’t have to be the case for you, though. Saving for retirement isn’t complicated, and you should be able to plan for your future and sock away enough money for your golden years. While a financial planner can help you set up the necessary assets, there are also plenty of simple things you can do right now that will help ensure you have enough savings put away for when you’re older.

1. Start living with a monthly budget

Two people balancing their budget

The first step you want to take is to create a budget for yourself or for your family. | Keystone View/FPG/Getty Images

If you don’t have a well-crafted budget, it’s entirely too easy to spend all of the money that’s coming in. By making a monthly budget, you’ll be able to see exactly what you have to pay for, and how much you have left over for discretionary spending. Factor in putting a percentage of your monthly earnings into a retirement fund of some sort.

2. Learn to cook

man in kitchen holding a help sign

Do you often eat out in restaurants or diners? |

Eating out is a heck of a lot of fun. However, it can really take up a lot of your monthly income, and eat into the amount of money you’re trying to set aside for retirement. Eating at home is going to be cheaper in most cases. One of the best ways to encourage yourself to eat at home is to learn how to cook. Pick up a cookbook online or at your local bookstore and try a few of the recipes. If you don’t know where to start, consider taking a cooking class to learn how to make restaurant quality meals in your own kitchen for a fraction of the price.

3. Switch to a cheaper grocery store

Aldi store sign

Do you always shop at the same store? If so, it might be time for a change. | Matt Cardy/Getty Images

Most of us go to a certain grocery store because it’s close by, or because we like the people or layout there. Whatever your reasons, don’t be scared to branch out and try new stores. You might be surprised by how much money you can save by simply switching grocery stores, or even by switching from brand name products to generic ones. A dollar saved here or there can really add up, and the more you pay attention, the easier it becomes to save a boatload on food, as well as the things you simply can’t live without.

4. Take advantage of deals and discounts

A woman looks at coupons in a grocery aisle of a supermarket

Using coupons could save you quite a bit of money during your next grocery run. | Yeulet

As a part of switching stores, it’s also smart to keep an eye out for deals. You don’t have to become a crazy coupon lady, just take some time every couple of days to look around for the best possible price. Buying everything at discounted prices can help keep more money in your bank account, which means you can add more of what you save to your retirement fund each month.

5. Always put at least 15% in savings

hand dropping money into a piggy bank

Always put some money into your savings account. |

According to CNN Money, many financial advisers say you should save between 10 and 15% of your monthly income for retirement. To be on the safe side, go with 15% because some advisers recommend you save more. If you have the funds, there is no problem with saving more money. At certain times in your life, you may simply not be able to sock away that much. So, when you can, you need to make sure you’re putting away at least the recommended amount.

6. Focus on constant growth, not big gains

happy businessman smiling while reading his smartphone

Remember that you need to invest throughout your life, not just one time. |

It’s been said a thousand times: investing is not a sprint, it’s a marathon. When you’re investing and saving for retirement, you need to focus on the long term and forget about trying to boost your savings short term. Large gains in a short amount of time from stocks or some other investing techniques are great, but you can’t expect to do that all the time. Small goals eventually add up to significant wealth. If you’re unsure of how to do this, reach out to a financial planner today. The sooner you do it, the better.

7. Put bonuses toward retirement

man being handed money for work

It might be tempting to spend your bonus money right away, but you should consider saving it. |

Some companies pay out bonuses every year. While many people go out and spend this money, a better use of it is to bolster your retirement savings. Annual bonuses should be treated as extra money, not funds you have figured into your monthly or annual budget. According to CNBC, your bonus will help you the most if you put it into your retirement fund like a 401(k), or if you use it to pay down some high interest debt like credit cards. The last thing you should do, however, is go out and spend it.

8. Save your tax refunds

A check from the United States Treasury

As tempting as it may be, don’t spend your tax refund money right away. | William Thomas Cain/Getty Images

A similar idea to putting your bonus into your retirement fund is adding your tax refund as well. Like bonuses, tax refunds aren’t income you can rely on, and while they’re nice income boosts, they’ll be most beneficial in the long run if you put them right in your 401(k) or savings account. It might be tempting to treat yourself to something you’ve had your eye on for some time, but don’t give into that temptation.

9. Work a side gig that boosts your retirement fund

a man walks by a now hiring sign

Find something you’re passionate about and get paid for it as a part-time job or side gig. | Spencer Platt/Getty Images)

Working a side gig isn’t always easy, and if you have a busy family life, you may not have the time for it. However, if you can make time, you can put away a lot of extra money for retirement. There are all kinds of side gigs or part-time jobs out there. If the idea of spending more of your precious time working doesn’t appeal to you, consider finding a way to do something you really enjoy. For example, if you love doing yoga, consider teaching a class a couple of times a week.

10. Start a 401(k) as early as possible

personal 401K plan financials

If you haven’t started building your 401(k), there is no better time to start than the present. |

The earlier you begin to save for retirement, the better. In general, it’s best if you start in your early 20s, but if you’re older than that, don’t fret. You can still save plenty of money for retirement, you just have to start now. If your employer has a 401(k), you should consider enrolling. This will get you on the fast-track to financial security and building a good retirement fund.

11. Do an IRA if you can’t do a 401(k)

Magnified ROTH IRA message on dollar bills

No 401(k) match at your company? Don’t worry, you can still get yourself an IRA. |

For those of you who are self-employed, or you work at a company that doesn’t provide a 401(k) program, there are individual retirement accounts. There are a few different kinds of IRAs out there. Typically, most people either do a ROTH IRA or a traditional IRA. Which is better depends on your personal situation and how you want to save for retirement. If you’re unsure which is best for you, contact a financial planner.

12. Take advantage of your employer’s 401(k) match

A happy man

Take advantage of your employer’s 401(k) match. |

Many employers match up to a certain percentage of funds contributed to a 401(k) plan. If your employer does this, you need to take advantage of it. The reason being that it’s essentially free money. Let’s say that your employer will match up to 5% in 401(k) contributions, if you only contribute 3%, you’re missing out on extra money your employer is willing to give you. If you don’t contribute at least 5% to your 401(k), you’ll never see that money.

13. Consolidate IRAs or other retirement funds

retirement label on jar filled with coins

Try to only have one account for your savings and investments. |

Over the years, you may work a number of different jobs and open a few different types of retirement accounts. Instead of managing all of them separately, it’s generally best to consolidate most of your retirement accounts into one fund. The reason to do this is to reduce the number of fees you have to pay. Also, it’s simply easier to keep track of the money over time. When it comes to investing, no two people are alike, so you need to talk with your financial planner before making any big moves.

14. Cut unnecessary expenditures

women with paper bags walk inside a mall

It’s easy to fall into the trap of spending too much money on subscriptions. |

Everywhere we go, almost everything is designed to get us to part with our money. It’s very easy to spend more than you need to — and often more than you have. While coming up with a monthly budget and sticking to it will help you stay on track, there’s something else you can do to cut unnecessary expenditures: Beware of things that carry a subscription. They’re easy to forget about because they simply renew if you’ve enabled automatic payments, and they can zap your discretionary spending very quickly. Try to focus on the things you need, and narrow down only a few things you want that you can reward yourself with.

15. Never pay the minimum on credit cards

credit cards on a gray background

Make it a habit to pay off your credit card debt. |

Credit card debt can make saving for retirement seem impossible. Generally, it’s best to get rid of high interest rate debt (like credit card debt) as quickly as possible. This means you need to always pay more than the minimum payment on your credit card bills. Paying the minimum will only result in you paying a lot in the long run, and you likely won’t ever pay off your cards that way. Make a commitment to pay more than you absolutely have to each and every month, and you’ll be surprised by how quickly that debt disappears.

16. Hunt for the best rate on credit cards

credit cards

Do your research before signing up for a credit card. |

If you have to use credit cards, don’t just sign up for the first card you see. Do some research first, and find a card with the best interest rates and benefits. Many credit cards have benefits like airline miles, cash back on purchases, and special discounts or privileges. Most of the benefits are relatively small, but like with investing, if used properly, they can really add up.

17. Have automatic deposits set up

bank deposit slip

Create automatic deposits into your savings account. |

It’s far too easy to forget to transfer money appropriately for retirement each and every time you get paid. To make things easier on yourself, set up automatic transfers to your retirement accounts. That way, you never have to think about making an effort to save. It will simply happen when you receive your direct deposit.

18. Never take money out of your retirement funds

businessman working with generic design notebook

It might be tempting, but don’t withdraw your retirement money before you actually retire. |

No matter what you do, don’t withdraw money from your retirement funds before you actually retire. Investopedia reports that about 21 percent of people borrow money from their 401(k) plans, despite the fact that doing so comes with a host of problems, including extra interest and fees. Also, it goes against everything you’re supposed to be doing with your retirement account, which is saving for the future and focusing on consistent, small gains.

19. Buy a used car

used car for sale

If you’re looking to buy yourself a new car, we recommend looking at used vehicles. | Justin Sullivan/Getty Images

The average depreciation rate of a new car is 19 percent in the first year. Half of that happens as soon as you drive off the lot. While it may seem smart to buy a new car that has never had anyone treat it poorly, generally you’re better off if you buy a used car. This doesn’t mean you have to buy an eight-year-old beat up sedan. There’s millions of excellent used cars out there, and while they will depreciate over time, they’ve already experienced the worst of it.

20. Keep track of progress but don’t obsess

Girl wrapped in a blanket sitting and working in a cafe

Remember that it’s OK to splurge and enjoy your life every once in a while. |

When you’re focused on saving for retirement, it can become easy to obsess over the numbers. What you need to keep in mind is that you should still live an enjoyable life while you’re younger. Don’t sit around doing nothing for 50 years, only to retire and wish you’d had more fun. The key is to track your progress but not obsess. Checking on your retirement every few months is smart. Talk with your financial planner when you want to make adjustments, or when things in your life have changed. By keeping a consistent eye on things but not obsessing over them, you can have the funds to retire comfortably, and live life to the fullest while you’re still young.

21. Have a target retirement date


Think about what age you’d like to retire at. |

Too many of us have no idea when we want to retire. It’s a tough question when you’re young, but having an answer at the ready (even if you choose to decide later you’d like to keep working longer) is not a bad idea. You don’t have to be too specific when making plans this far in advance. Narrow it down to a year or two and plan for that. Over the years, you can make adjustments as you go.

22. Find a good financial adviser

businessman showing a document to a couple

Do you have a financial adviser? | Studio

Having a good financial adviser is key to building a quality retirement plan. In general, someone who is interested in what you want for yourself once you retire is the best kind of adviser. This is why it’s so important to have retirement goals. If you have a few ideas about what you want your retirement to be like, your adviser can help you plan for that future. Don’t know where to go? Ask your family and friends who they use. Usually, a recommendation or referral is the best way to go.

23. See your financial adviser at least once a year

Months and dates shown on a calendar

Make sure you’re regularly meeting with your financial adviser. |

Once you have a financial adviser and have created a plan with them for your retirement, you need to meet with them periodically to make sure everything is on track — and that it stays that way. Many advisers suggest meeting at least once a year. If that seems infrequent, every six months is usually enough. There’s no need to obsess over what your financial adviser is doing. However, you do want to be involved in the process, and any changes to your retirement plan should be discussed thoroughly.

24. Delay social security payments

Social Security newspaper scrap

Don’t take social security payments unless you absolutely have to. |

When you delay taking social security payments after you turn 66, your benefit payout increases by 8%, according to Kiplinger. This means the longer you can go without using social security, the better off you’ll be. Don’t take social security payments unless you absolutely have to. Of course, talking with your financial adviser is the best way to determine when the right time is to take advantage of those benefits.

25. Don’t take on unnecessary debt

A woman chooses a credit card

Try to avoid debt if it is possible. |

Debt can be a nasty thing, especially if you didn’t really need to take on that debt in the first place. Credit cards, unnecessarily large car loans, and other unneeded financing should be avoided at all costs. The best plan of action is to live within your means and avoid any debt that you don’t have to take on.

Some debt — like for houses, well-maintained used cars, and school debt — is okay. But if you take loans out for wants rather than needs, you’re going to have to dig yourself out of a hole before you can seriously save for your golden years.