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How to Plan for Retirement if You’re in Your 30s

In your 30s, retirement seems to sneak up on you. You might find yourself thinking more often about what your retirement years will look like, how you can make them a reality, and how much you should be saving now to achieve that goal. As you plan more aggressively for the post-work chapter of your life, here are a few tips to help you define your retirement plans

Consider What Your Retirement Might Look Like

This is the fun part. Dream a little! Where do you want to be in your retirement years? Maybe you have ambitious travel plans, or you want to move to a new city. Perhaps you want to spend your days working on a hobby or giving back to the community. However you see those days playing out, decide what your dream retirement might look like so that you can determine how much you’ll need to save. Discuss these ideas with your financial advisor so that they can help you create a sensible financial strategy to achieve your goals.  

Contribute to Your 401(k) or IRA More Aggressively

This may sound like a given, but saving for your retirement in a more focused and serious way is a great step to take in your 30s. Take full advantage of 401(k) matching, if it’s offered in your employment benefits, and contribute as much as you can without straining your budget. If you max out your annual 401(k) contribution, you can also open an IRA account to continue saving beyond that amount. Of course, if you are self-employed or if your employer doesn’t offer a 401(k), you should carefully consider which is the best IRA option for you.  

Work on Eliminating Your Debt

If you have outstanding debt, now is the time to work toward a debt-free life. Without interest payments and growing balances hanging over your head, you will have a great deal more to save for retirement. Don’t know where to start? We recommend Dave Ramsey’s debt snowball method to help you pay down your debt quickly. 

Build Your Emergency Fund Savings

Building your emergency fund goes a long way in protecting your financial security. It’s typically recommended to save between three and six months’ expenses—to be used in the event of an emergency or another unexpected event. It’s up to you and your family to determine what you consider an emergency; however, this fund will help you prepare for the unexpected, keeping you out of debt and allowing you to stay on course for your retirement savings.  

Check on Your Retirement Progress Consistently

A watched pot never boils, right? So, it’s important to keep from checking your retirement accounts daily. This will only create panic, and you won’t see your account rising rapidly. Instead, set a schedule to check in on your progress so that you’re aware of how your investments are doing and whether or not you’re on track for retirement. There isn’t a hard-and-fast rule on how often to check on your accounts, but we would recommend between once per month and once every three months. Of course, it always helps to have an advisor looking after your accounts as well. 

Devise a Savings Plan for Your Children’s College 

If you have children, you might have thought about setting up a 529 plan to save for their college tuition. Anything that you can do now to plan for future financial stability will make it easier for you to continue saving for retirement and stay true to your long-term financial goals. A 529 plan will allow your contributions to grow tax-deferred, and there is no withdrawal penalty when it’s time for college (as long as contributions are used for qualifying expenses). More than 30 states offer tax deductions or credits for contributions to this type of account as well. As with any savings plan, it’s a good idea to set up automatic monthly contributions to your 529 plan to keep your savings on track. 

Need help with retirement planning?

Southwestern Investment Group can help you plan for retirement at any age, creating a strategy to meet your post-career goals. Contact us today to schedule a consultation.

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