6 Basic Retirement Guidelines from First Bank and Trust Company
January 6, 2023
Here are six basic guidelines to keep in mind when developing your retirement strategy.
1. Pay Yourself First.
Establish a dollar amount you can save comfortably every month. Always remember, you are entitled to keep a portion of what you earn.
2. Don't Bank on Your House for Retirement Income.
A house is primarily a home, not an investment for your retirement. While you may eventually trade down when you retire, consider the equity in your home an emergency reserve, not a primary source of income.
3. One Good Place to Save for Retirement Is a Company Retirement Plan.
If your company offers a match, at a minimum, you should strive to contribute the same amount, and over time, increase the percentage you contribute beyond what your employer matches. Remember to consider other tax-advantaged savings vehicles as well.
4. Make Retirement Your First Savings.
If your disposable income is limited, save money in your retirement plan before funding long-term goals such as your child's college education. Remember, your retirement is the largest expense you'll ever have to fund. Use our retirement calculator to see how much you should be saving each month.
5. Avoid Taking a Retirement Plan Distribution before Retirement.
Transfer your plan's savings to an IRA or a new company retirement plan if you change jobs. Don't consider withdrawing money until you've exhausted all other possibilities.
6. The Best Time to Start Saving for Your Retirement Is Right Now.
Accumulating enough money to retire comfortably takes time.