Social Security Won’t Cover Your Retirement? How To Prepare Ahead for Retirement

According to expert advice, there is a need to put some measures in place before retirement rather than relying solely on Social Security. Reasons being that social security might not be around forever, maybe till 2034. 1 in 4 Americans has no savings at all.

Jon Lawton, a managing partner, fiduciary advisor, and certified financial planner from OpenAir Advisers said:

“In the past, Social Security benefits, plus pensions from their employer, were more than enough to carry a retiree through retirement, however, the introduction of the 401(k) shifted the responsibility of saving for retirement from the employer to the employee.”

Here are 5 ways to secure retirement, with or without Social Security.

1. Invest Your Money

You can save in the usual savings account; but the interest won’t grow enough to support retirement needs, hence the need to invest in stocks, bonds, and other securities (tax-advantaged account such as a 401(k) or IRA). In case you don’t know how to get good investments, you can secure the service of a free investment advisor online.

2. Get Your Full Employer Match

Depending on where you work; employers offer to match employees’ retirement contributions. This is an opportunity you shouldn’t miss. It can help you meet your savings goal much faster. It works by employer matching a percentage of your contribution, up to a certain percentage of your total salary, or matching your contributions up to a certain dollar amount.

Read More: Which State Is Fronting an Imminent Egg Shortage?

3. Max Out Your HSA

Blaine Thiederman, a certified financial planner and founder and lead advisor at Progress Wealth Management in Denver advised.

“HSAs are easily the most tax beneficial way to save for your future medical bills, why? The contributions are made pretax, allowing you to reduce your taxable income and tax bill. The funds also grow tax-free. And unlike a flexible spending account, any unused money rolls over to the next year. At age 65, you can use the funds for any purpose, not just paying for medical expenses.”

4. Get Rid of Debt

Create a plan to pay your debts. A car loan, student loans, credit cards, or a mortgage, don’t take these debts into retirement. Thiederman said, “Less money going out every month makes it that much easier to afford life without Social Security.”

5. Create a Budget and Stick To It

Don’t just spend; create a budget. Know how much is coming in and where every dollar will go. “Many clients I’ve worked with have a hard time sticking to a budget, year after year, they find themselves not saving enough,” Thiederman said. Create a budget and stick with it. It’s not going to be easy; it takes discipline.

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