Greg Lefever, PNC’s Wealth Management Managing Director in Central Pennsylvania (Submitted)
I started saving for retirement a few years ago when I started at the York Daily Record.
At the time, it seemed pretty pointless.
“Wouldn’t that money be better spent on things I need NOW, like utilities, rent, groceries, sushi, chocolate, wine, Egyptian cotton sheets with a 1500 thread count and similar high priorities?” I thought.
Turns out, I could afford all those things in moderation and still save for retirement. (Although I still sleep on really crappy sheets, but what can you do?)
All that saving is putting me ahead of the game.
According to a PNC Bank survey, almost of half of Americans in their prime retirement planning years believe they will need to work longer than previously planned in order to save enough to retire.
PNC’s survey also revealed that women have more doubt than men about their ability to achieve a secure retirement. More than half of women, 51 percent, compared to 40 percent of men agree with the statement, “I’m afraid I may not be able to retire.”
For those people, Greg Lefever, PNC Wealth Management Managing Director in Central Pennsylvania, offers the following tips:
• Don’t delay. It’s never too late and if you have a plan in place you will be in a much better position when your health or your employer puts you in an unexpected situation.
• Take the time. You don’t have to spend hours planning for retirement. The key is to get started and review where you stand at least annually. When you have major life changes, including children, marriage, divorce or relocation that is also an important time to revisit. It’s less about time and more about engagement and awareness.
• Be resourceful. Think of every financial services organization you already have a relationship with: Your bank, your 401k provider, your insurance agent. Use those sources to investigate all of the financial planning resources that may be available to you.
• Save till it hurts. Increase contributions to a workplace retirement plan until the limit is reached and maximize contributions to Individual Retirement Accounts (IRAs) and employer-sponsored defined contribution plans. Employer-sponsored plans, including 401(k)s, and Traditional IRAs, offer advantages including tax-deductible contributions and tax-deferred growth.
• Be penny wise. Pay off as much debt as possible and reduce spending to maximize retirement savings. Consider paying off your mortgage to eliminate that obligation, though remember there may be tax implications for doing so. However, don’t forget to put money aside for emergencies.
• Roll with it. Roll over 401 (k)s from past employers into IRAs or current 401 (k)s. This may reduce fees you pay and it’s just plain easier to have your money concentrated in fewer accounts.
• Know thyself. Also critically important is to know how much you will need to maintain your desired lifestyle in retirement. Consider future health care expenses and think about the timing when you will begin receiving Social Security payments which could affect the amount one receives.