3 Painless Ways to Retire Richer

Everyone wants to have a financially secure retirement, but to get there, you’ll have to save and plan. Just getting started with a retirement savings strategy can be the hardest part of getting on the road to retiring richer.

Once you’ve begun, though, there are some things you can do to make the journey a little bit easier. The following tips can help you boost your savings without you feeling like you’re sacrificing, and give you the mental shove forward you need in order to keep up your momentum in striving toward your financial goals.

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1. Save half your raises

The best way to save money is before you think you have it. That’s a big reason why so many employers have moved toward automatically enrolling their employees in 401(k) retirement plans, because it gets workers into the habit of saving, sometimes without even realizing it.

Yet the problem with most automatic enrollment plans is that they start you out saving only small amounts of your pay, often 3%. You can increase that amount yourself at any time, but your take-home pay will go down as a result.

The simple answer: Wait until you get a raise and boost your contributions at that time. For instance, if you get a 2% raise, increase your 401(k) contribution rate by 1 percentage point. That way, half of your raise will go toward your retirement, but you’ll still get the psychological boost of seeing your paychecks go up.

2. Invest half of your tax refund

When it comes to saving, big chunks of money that you can potentially set aside are few and far between. One area where many people have an opportunity to do this is with their tax refunds. Millions of taxpayers get refunds of $1,000 or more each year. For someone making near the typical household income of around $50,000, saving half of a $1,000 tax refund is the same as boosting your 401(k) contribution by 1 percentage point.

Again, you could save all of your refund instead of half, but where many people get bogged down in their savings strategy is that they get tired of never getting any immediate reward for their efforts. By hanging on to a portion of your refund, you’ll get the payoff right now while also setting yourself up for future success.

3. Set aside half your side-job earnings

Working a second job has been a time-honored tradition to save more money, but the rise of the gig economy has made side jobs more popular than ever. With estimates of 40 million to 50 million Americans taking on work on the side to earn more money, there are ample opportunities to boost your income.

Admittedly, many people work second jobs because they must in order to make ends meet. But if your most important long-term priority is putting yourself in position to retire as rich as possible, taking a portion of your earnings from a side job can be a great way to supplement the savings from your primary employment, and get your retirement nest egg growing that much faster.

Gain without pain

Retiring rich is just a dream for many Americans, but you can make it a reality — if you’re committed to it. Yet saving for retirement doesn’t have to be painful. By making incremental changes like the ones mentioned above, you’ll be able to reach your financial goals more easily over the long haul.

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