Ten Easy Ways to Save for Retirement

The process of saving for retirement can be a daunting task that some people never take the time to plan for. Here is a list that will help you allocate your money for retirement.

1. Contribute to your 401(k) up to the limit and take advantage of an employer match

2. Set up a Roth IRA and contribute the maximum ($5,000 a year in most cases)

3. Invest in Target Retirement index funds that match your age and set the asset allocation

4. Set up an emergency fund for 3-6 months in protection for loss of income

5. Invest in yourself (college degree, personal finance courses, ect.)

6.  Start a side business to increase revenue streams

7. Budget expenses by spending on the things you love and ruthlessly cutting out expenses of things that you don’t need

8. Take advantage of windfalls that come your way and allocate the money wisely

9. Pay off credit card bills that have a ridiculously high interest rate. The money that is spent on interest can be used to fund future retirement

10. Live within your means and find a balance of spending and saving that fits your lifestyle

This list was compiled from a numerous of great investing and finance books that I have re-read recently. Authors of investing books tend to agree that saving for retirement is one of the most difficult and neglected parts of finance for middle-class Americans.

The lack of financial education of the working class can be attributed to not teaching finance in school, but I believe that if someone truly wanted to learn about personal finance, they could find all the information they needed at the library.

The two books that have been most helpful for me in planning for retirement is I Will Teach You To Be Rich by Ramit Sethi and The Bogleheads’ Guide to Investing by Taylor Larimore, Mel Lindauer, and Michael LeBoeuf.