Every year you should take the time to evaluate your long-term financial plans. If you are very close to retirement, you might need to do this more often than once a year. Try to come up with a schedule that works for you. Look at it each year on your birthday, the New Year, each fall when school starts, at tax time, find a time that is best for you.
During this time, your retirement plans should be part of this process. When you do sit down to review, consider these tips:
1. Every year we see inflation rising. Your income will often rise as well. It is important that your contributions to your retirement account should rise too. If you have been contributing 4% of your income, try to increase it to 4.5% next year as an example. If you contribute a set a dollar figure, try to make sure you increase it more than the inflation increase each other. This will help you to stay ahead of the curve.
2. Talk to a financial planner, tax accountant or investment specialist at least yearly. Make sure you keep up to date with the changing tax laws in regards to retirement accounts and funds. These can change quite drastically at times, so what you are doing now… might not make sense in five years.
3. Evaluate your retirement investment options. Always look at an employer-sponsored account first, but do not rule out a personal IRA too. Investing into your retirement can be a great way to keep money in your pocket now and in the future.
4. Talk to a representative from the mutual fund company holding your retirement accounts. Review their performance and make sure it matches your goals.
Good planning is the key to success in your finances. Make sure your retirement is part of those plans!
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