Chances are you've put an actionable retirement plan into place, but sometimes life can get you sidetracked. It's a question that weighs on the minds of most investors during their working years: Do I have enough to retire?
The answer, however, isn't so cut and dry. Much depends on factors like: Have my circumstances changed since I made my initial investments? Am I still on track to retire when I originally planned? Have I had major health changes in recent years?
As you start thinking about your answers, a good place to begin is with the TD Ameritrade Retirement Calculator. It can help you estimate what you may need to save to reach your retirement savings goal. If you determine you're on the right track, then keep plugging away and stay consistent with your plan.
Need to Make Some Changes?
If you need to make changes to your retirement plan, here are the next steps you can take to help your nest egg play catch-up:
Every dollar counts, and there's still time to make adjustments. Revisit your goals to make sure they're realistic and achievable. You may be able to make adjustments to your plan, such as spending less in your retirement years, or working longer to achieve your plan. When planning out your retirement goals, a helpful approach is to use the acronym "SMART" to help ensure your goals are specific, measurable, attainable, relevant, and time-based; helping you stay focused in your retirement planning journey.
Re-evaluate your budget.
Where are you spending money, and is it possible to make reductions? The money you save can be invested, put in a savings account, or used to increase your 401(k) contributions. If you receive a year-end bonus, you can create a plan to allocate all or a portion of it to your 401(k).
Make it automatic.
Set up payments to automatically draft funds directly into your retirement account, making it easier for you to make contributions without forgetting.
Explore catch-up contributions for an IRA or 401(k).
Total annual contribution limits are $5,500 for Traditional and Roth IRAs; however, if you are over 50, the IRS currently allows investors to contribute an additional $1,000 to their Traditional or Roth IRA (for a total of $6,500). Annual contribution limits for a 401(k) are $18,000; however, if you are over age 50, you can contribute an additional $6,000 to a 401(k) (for a total of $24,000).
When you evaluate your funds, you’re taking action to ensure you stay the course on your retirement plan. Just remember—it's never too late to take a step back, evaluate your plan, and adjust it accordingly.
Setting financial goals today is one way you can help keep your retirement plans on track.