What to do at each age to make sure you’re on track to retire

There are undoubtedly a lot of things to follow when it comes to managing our personal finances. We keep an eye on our spending, our savings, our investments, our debts and even the ups and downs of our credit rating.

Making sure we’re on the right track to retirement may not seem so urgent, but it’s arguably the most important facet of our finances to watch out for. After all, you don’t want to approach your non-working years and realize that you are not financially prepared to quit working.

Select spoke to Andrew Meadows, senior vice president of Ubiquity Retirement + Savings, about what you can do each decade to make sure you’re on track to retire at 67.

Your 20 years are a financially difficult decade. You’ve just graduated from college, perhaps on student loans, and you’re embarking on a new lifestyle that involves paying rent, utility bills and more, all with a living wage. ‘entry level.

“When you’re just starting out on the job, you might find that retirement feels like a lifetime in the future, ”says Meadows.“ But don’t waste your biggest savings benefit: time. “The sooner you start putting money into your future, the more it can grow.

Start by depositing a percentage of your paycheck each pay period into a 401 (k), if your employer offers one. Many employers also match your contributions up to a certain percentage.

“You might not be maximizing your contributions, but saving at least enough to maximize your business’s match will make you feel like you’re on the right track,” says Meadows.

Your goal at 30: Save once your salary. This benchmark includes money in your savings, retirement, business matchmaking and investment accounts.

As you age, advance in your career, and earn a higher salary, you probably have more savings capacity than in your 20s. Take this opportunity to contribute Following when you retire with every bonus, increase or promotion at work.

“You know you’re on the right track when you’re able to contribute to this game and start to get closer to maximizing what you’re putting away,” Meadows said. Experts suggest aiming to save at least 15% of your gross pay.

Your goal at 40: Save 3 times your salary.

Your spending will likely increase in your 40s as you grow a family and accept big ticket items like a mortgage. The key is to continue to contribute to your retirement as you did, but monitoring your new expenses to make sure they don’t eat into your progress.

Paying for your child’s college years can make a big dent in your retirement savings later on. Dedicate your savings to higher education by investing in a 529 account where your income and withdrawals (as long as they are used for qualifying educational expenses) are tax-free.

Your goal at age 50: Save 6 times your income.

Your 50s is a great time to get down to the serious business of financing your retirement. Meadows suggests using those years to sketch a budget and list potential expenses. Future retirees may also want to consult a financial planner who can help them create a personalized plan.

At 50, don’t forget the extra boost to your savings thanks to catch-up contributions. “The catch-up contributions in the 401 (k) are there because you may not have saved enough in the past 20 years,” says Meadows. Workers aged 50 and over can contribute an additional $ 6,500 per year into their 401 (k) and an additional $ 1,000 into their IRA.

Your goal at age 60: Save 8 times your income.

“Now that you’re in your 60s, it’s a critical time to make sure you’ve saved enough,” Meadows says. If you find that this is not the case, it may help to take last minute measures that can save you a considerable amount of money, such as reducing your lifestyle.

Matt Rogers, CFP and director of financial planning at eMoney Advisor, also suggests getting a Social Security estimate from the Social Security administration to confirm the expected benefits. “It will help set expectations and make plans more realistic,” Rogers said. “Often, it is estimated that Social Security replaces 30-40% of pre-retirement income.” Remember to also check that retirement plans and pensions have the correct beneficiary.

Keep in mind that delaying the collection of Social Security does pay off. Although you can start receiving benefits at 62, you are entitled to 100% of the benefits when you reach full retirement age. Waiting until age 70 means that your benefit amount increases even more.

Your goal when you retire at 67: Save 10 times your income.