Got a Raise? Boost Your Retirement Savings!
April 20, 2022
April 20, 2022: Getting a raise at work is one of the most rewarding experiences you can have in your career. It typically signifies a job well done, and it may accompany new responsibilities, too. With your increased wages, though, comes the question — what will you do with the extra funds? The answer depends on the amount of the raise as well as what goals you may have. One of the best ways to allocate this money, though, is using your raise in wages to help your retirement savings. Many people wonder how to boost your retirement savings, and this is one of the best strategies you can use.
Increase Your 401(k) Contribution
Investing in a 401(k) is one of the most popular strategies for saving for retirement. Indeed, this retirement strategy offers security and impressive returns that few other options can provide. Because these contributions are taken directly from your wages, you can enjoy a lowered tax liability while setting aside funds for retirement. If you’ve recently received a bump in wages, then, one of the best ways you can use it is by increasing your 401(k) contributions.
Automate Other Retirement Accounts
If you’re well into your retirement strategy, you may even have multiple accounts established to help you save and plan. Some of the other types of accounts may include Individual Retirement Accounts (IRAs), 529 Plans, and Health Savings Accounts (HSAs). With the extra security that additional wages can provide, you should be able to automate your weekly or monthly deposits into these accounts so that you don’t even have to think about saving.
Make Additional Payments on Your Debts
Saving is often the only action discussed when considering retirement planning. Paying off debt is arguably even more important, though — especially as you get older. Unpaid debts can result in liens against your estate, and this can jeopardize any assets you plan to leave to your loved ones. It’s possible to pay off debt once you’ve already retired, but it’s better to achieve freedom from debt before you stop working. To do so, you may allot a portion of your additional wages towards paying off mortgages, credit cards, loans, and other liabilities.
Invest in Better Insurance Coverage
Planning for retirement is also planning for aging. As you get older, you will want to ensure that your loved ones are cared for after you pass. To this end, investing in a life insurance policy is a great way to prepare for retirement. In addition to the financial protection, it can provide to your family, a whole life insurance policy can offer cash value and other attractive benefits that make it a great option for retirement planning. Look for coverage that can replace your income and pay off any debts that may be left behind.
About 1891 Financial Life
At 1891 Financial Life we don’t just sell policies, we offer possibilities. We pride ourselves on giving back to the communities that we serve by providing quality and comprehensive insurance solutions. We are a not-for-profit life insurance Society, which means the sales from these financial service products help fund member benefits along with social, educational, and volunteer programs designed to respond to community needs.
Our portfolio is extensive, ranging from various life insurance policies to our annuities to support your financial needs no matter what stage of life you’re in.