By the time your 30s arrive, you’ve probably settled into an adult life.
But you haven’t really fully embraced “adulting” unless you’ve started saving
for retirement. Whether it’s through an employer-sponsored retirement plan or
some other financial product, the time to start planning for the end of your
working days is now. Even if it seems like retirement is just a distant dream,
you’ll want to get started now to make sure you and your family are secure when
you’re ready to stop working. With that in mind, here is a guide for how to
invest for retirement at age 30.
How Much You Should Have Saved at 30
There isn’t a hard-and-fast rule as to how much money you should have
set aside for retirement at 30. You are at the age, though, when you should
start thinking about what you want your life to look like as you get older. Do
you see yourself having kids? Would you like to travel when you’re older? Are
you going to retire as soon as humanly possible, or are you in the type of
industry where you might want to work into your old age?
Once you’ve figured out these questions, you should have a better idea
of what your retirement will be like. A retirement calculator can help you figure out how much
money you’ll need to have saved for retirement and show you if you’re on track
or not. Once that’s done, you can see what adjustments you need to make in
order to meet your goals.
What to Do If You Have No Retirement Savings
First off, don’t despair. Sure, it would be great if you already had a healthy
nest egg to get your retirement savings going. But you’re still young and
you’ve got plenty of time to make up the gap – provided you get serious about
saving for retirement right now.
You need to immediately look at what investment opportunities you have
available to you. If you work somewhere with an employer-sponsored retirement
plan like a 401(k) or a 403(b), enroll right away. Does your employer offer a company match? Even
better. Make sure you’re investing at least enough to take full advantage of
the match – that’s literally free money your company is giving you to invest
for your future. If you’re company doesn’t have a retirement plan, look at
other options. Consider opening an individual retirement (IRA).
No matter what type of plan you use, it’s important you put aside as
much money as you can afford. You might not be able to put aside the maximum
allowed yearly contributions, but look at your finances and see if there are
any areas you can cut back on in order to contribute more to your retirement.
It might mean a few less meals out or canceling some subscription services, but
it will help ensure you can afford to live the comfortable life you want when
your retired.
How to Invest for Retirement at Age 30
Again, you’re in luck. At 30, you aren’t so close to retirement that you
need to be incredibly conservative in your investment strategies. Experts
generally agree that you’ve still got a enough time left before retirement,
that you can be more aggressive than you would be if you were 50 and saving for
retirement. Look at the options offered by your retirement plan and create a
mix of investments. Some experts suggest keeping some of your money in less
risky investments like index funds or bonds, while investing other money in
stocks or other options that offer a bit more risk. The thinking behind this is
that you might suffer some short-term losses, but in the long run there is a
better chance that these investments will give you the healthy returns you want
to fund your retirement lifestyle.
If you aren’t sure about how to go about investing, you might want to
consider finding a financial advisor. A financial advisor will look at your
specific financial situation and help come up with a plan to get you ready for
retirement. You can use the SmartAdvisor toolto find a financial advisor in your area. You
can also consider using a robo-advisor. Robo-advisors will help you invest your money
and have lower minimum asset requirement than many financial advisors.
Click here for the original article from Yahoo Finance.