Tips for saving for your retirement besides your 401(k)

January 22, 2016 | Linda Barner

A 401(k) is a savings plan offered by employers to help their employees put aside money for retirement. People with a 401(k) option can invest some of their paycheck before taxes are taken out. Plus, many employers may match up to a certain amount of the employee’s contribution.

While 401(k)s are a great option for saving for retirement, they’re not the only way. Here are a few tips for saving other than or in addition to contributing to a 401(k). Remember to consult with a qualified tax professional for your individual situation.

Look into an IRA

Even if you have a 401(k), you still may be able to open an Individual Retirement Account (IRA), depending on IRS guidelines. An IRA has potential tax advantages, and there are several types to choose from. If you already have a 401(k), you may want to consider transferring the funds you’ve accrued to a Mission Fed IRA when you retire or change jobs. Please check with a financial advisor or tax professional to determine what’s best for you.

Start sooner rather than later

Once you begin making money, it’s easy to spend it—but it’s also easy to save it if you have your goals in mind! If you already have a Savings Account, you can either transfer money into it yourself or set up your direct deposit to have a certain amount go in automatically. Curious about how much you should save? While any amount is great, our “How Much Should I Be Saving” Infographic offers some guidelines when it comes to saving for retirement and other goals.

Monitor your spending

Looking at your spending habits will help you discover more opportunities for saving. Have you noticed that you’re spending $5 on a latte every day? That ends up being $1,825 a year that could be going towards your retirement, so you might want to start making your coffee at home. You can also look at how many times you go out to restaurants, the movies and shopping and figure out where you can save, too.

Save any extra income

If you receive a bonus or some unexpected funds, deposit it into your retirement fund immediately. This could also apply to a salary increase, especially since you already figured out a budget that is working for you. Any extra income can go towards your retirement or other savings goals you have in mind, within IRS limits and Income Restrictions.

When you have your retirement goals established, it’s much easier to put money away to achieve them! You may be familiar with the phrase, “Pay yourself first,” and it does tend to carry a strong appeal. Contact us today if you’re interested in beginning your savings journey with a Savings Account, and visit our IRA Center online or visit your nearest branch for more information regarding IRAs.

Mission Fed is federally insured by NCUA and is an Equal Housing Lender. All accounts and loans are subject to approval.

The content provided in this blog consists of the opinions and ideas of the author alone and should be used for informational purposes only. Mission Federal Credit Union disclaims any liability for decisions you make based on the information provided. References to any specific commercial products, processes, or services, or the use of any trade, firm, or corporation name in this article by Mission Federal Credit Union is for the information and convenience of its readers and does not constitute endorsement, control or warranty by Mission Federal Credit Union.

Linda Barner

Linda Barner

Linda Barner is VP Human Resources at Mission Federal Credit Union where she oversees the human resources and training and development functions. In addition to having over 20 years of experience in HR, Linda is a dedicated lifelong learner. She feels very fortunate to have found the perfect career for herself, because “professional student” does not pay the bills.

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