Friday, 1 January 2021

9 Easy Ways To Save And Invest More Money For Retirement


If you're feeling like you should be saving more for retirement, you're not alone. According to the federal reserve, about 63% of Americans feel like they're behind or uncertain. The good news is that there are some painless ways you can increase your savings without making sacrifices, canceling your vacations, or giving up dining out. These techniques can add a substantial amount to your savings, allowing you to either catch up on your retirement planning or get ahead. Providing the possibility to retire early or with much more money when you do retire. the savings tips can help you save hundreds or even thousands of dollars per year without changing your lifestyle to be one of a miser.


Here are nine ways that will easily help you save more. Take a special note at number nine which could potentially allow you to save 5% 10% 15% or more money every year.




1. Shop Your Insurance Around

Car insurance is one product that varies dramatically in price. One company could charge $50 per month while a similar company could want $250 for the same coverage. That's why it's so important to shop around on occasion say once per year. There are usually opportunities for discounts for bundles like homeowners, renters, or multiple vehicles in addition to other discounts that might be offered. Also, take a look at your deductibles and coverage to make sure you're not paying for more than what's needed. 


You can either shop online for the best product or get in touch with an agency that will price a list of companies for you




2. Claim The Full Employer Match

A 401k or employer-sponsored retirement plan can be a great place to grab some free money. If your employer offers a 401k it's likely they match contributions that are made. Most commonly, the employer will match 50% of your contributions up to 6% of your salary. For someone who earns $50,000 per year, the employer will contribute $1,500 per year towards your return. By not taking advantage of this benefit, you're simply leaving part of your pay on the table for your employer to keep.


401k contributions are also tax-deductible which will lower the amount you'll owe the IRS for that year 




3. Use Coupons And Immediately Invest The Difference

Coupons can help you save money both online and in-store. When you use them to reduce costs don't just squander the savings, immediately dedicate that money to a savings or investment account so it can be quickly put to work. Also, shop around when buying an item online chances are there are many sellers with the same item and many of them are willing to price match. Only use coupons and items that you would be purchasing anyway. Too often people make unnecessary purchases simply because they have a coupon. You can also take advantage of those discounts to purchase extra items that you'll need in the near future sparing you from paying full price




4. Use Credit Card Rewards

Taking advantage of cashback credit cards can add up over time. While somewhat controversial, credit cards can actually be used wisely, provided you don't carry a balance or purchase things you wouldn't otherwise buy in cash. Depending on your typical expenses you could get a cashback card geared towards dining out, grocery shopping, gas, business expenses, and more. Once accumulated, most credit card companies allow you to deposit their rewards directly into another bank or investment account. If you spend $30,000 per year and earn 2% cashback on those costs that's about $50 per month. That won't make you rich, but it's extra money for basically nothing, and if invested, can provide great returns


Look for credit cards that pay a welcome bonus often $200 or $500, of course, the key is to only use the credit cards for things you'd be purchasing anyway.




5. Refinance Loans

With interest rates so low it could be worth your time to refinance to achieve a lower interest rate on your home or car. On a $300,00 loan, the difference between a 5% interest rate and a 3% interest rate is almost $350 per month. Keep in mind that there are costs associated with refinancing and they vary, so you want to make sure the monthly savings will be worth those extra fees.


Consider that if you had a 30-year mortgage for seven years and you refinance it into another 30-year mortgage, you've extended the time that you'll be indebted. Since most mortgage companies only offer 15 or 30-year terms, your new mortgage will last 30 years from the date of the refinance, adding to the overall cost. Instead, try to make an arrangement with your bank to keep the original payoff date




6. Reduce Expense Ratios

Fees are sometimes unavoidable when it comes to investing, but that doesn't mean you need to overpay. Optimize your retirement accounts so they're invested in products that have low expense ratios. Most 401ks have low-cost options available, if not, consider rolling your 401k into an ira if possible. Individual retirement accounts have nearly unlimited options so there's no reason to pay high expense ratios say above 0.5%


Reducing these costs will make a huge difference in your portfolio especially as it grows to six and seven figures. Vanguard has some excellent options that are very inexpensive. If you're of the group that doesn't think twice about the fees being charged, do a quick calculation to determine how much you're actually paying




7. Automate Bills For A Discount

Some companies will provide a discount or special bonus offer when you set up automatic billing online. This not only reduces paper waste for those who are receiving bills in the mail, but it also frees up time and energy which would otherwise be spent paying bills. Insurance companies sometimes knock up to 10 off your premium for paying for the policy in full instead of paying monthly.


Phone providers also give discounts when you set up automatic billing. Banks often give discounts for loan payments that are automatic. Sometimes it needs to be connected to a bank account instead of a credit card, but that only takes a couple of minutes. Companies have varying policies on discounts for this but some of them are well worth it.


Saving 10% on your insurance is a guaranteed 10 return, and you'll also eliminate the risk of being charged a late fee for forgetting to make a payment on time.




8. Adjust Tax Withholdings

Receiving a tax refund is a nice feeling and in many cases, it feels as though you just received a bonus check from the government. When in fact, you loaned uncle sam that money for the year to use for free without interest. Ideally, you want to withhold the exact amount that you low in taxes for the year and no more. By hanging on to the money throughout the year so you won't receive a refund, you get to use that cash by paying off debt or putting that money to work investing.


Since receiving that check in the spring feels like a small windfall you're more likely to spend it recklessly on a spring vacation or an expensive new toy. You tend to have a different take on the tax refund when you consider that it isn't something exciting, but rather money you sent into the government for the entire year and you couldn't earn interest on it 




9. Ask For A Raise

This is one tip that could help you double your annual savings. Employees will only pay as much money as required to retain their employees and will sell them handout raises. It's common to see employers paying new hires more than their current experienced employees for the same job. If you're not earning what you're worth, request a raise. The chances of your boss coming to you and raising your pay without asking are slim to none. So it's up to you to make your worth known


New employees earning more than a veteran for the same job is unfair and should not be accepted especially considering high-quality employees traditionally earn more for their experience and loyalty. Take a look at the job market and consider jumping ships if you cannot negotiate fair pay


The inconvenience of changing jobs will be worth it for a 5% 10% or 15% increase in pay. And that extra money can be easily directed towards investing since you were previously living on a lower amount  





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