When Saving For Retirement Is Your New Year’s Resolution
You know how you feel when there is a task you have to accomplish that feels overwhelming. Initially, many people freeze. Let me let you in on a big secret. That’s why most New Year’s resolutions almost always fail. That’s right, in the enthusiasm of the moment, most people set huge goals and before the end of January, feeling completely overwhelmed, they have abandoned them.
Other people approach seemingly overwhelming tasks differently. They break the task down into small, easily accomplished steps. So whatever your goal or resolution may be, whether to get in shape, lose weight or start saving for retirement, if you really want to succeed, start with small goals and build on the “little wins.”
Every Journey Begins With A Single Step
It was the Chinese philosopher Lao-tzu who said, “The journey of a thousand miles starts with a single step.” And so it is with every type of journey you embark upon. Saving for retirement doesn’t begin with the resolution to save a million dollars. It begins with the small step of organizing your finances to see where you stand financially. You may need to set up and follow a budget.
It’s no different than resolving to run a marathon. You wouldn’t expect to be able to run a marathon within the very month of making a resolution to do so – if you’re not a trained runner. You train and work yourself up by running one block, then one mile, then another. The truth is that resolutions are typically things that require time to accomplish. They don’t happen overnight. You have to work your way up to running a marathon distance. And you have to save month after month, year after year for retirement.
Once you see where you are financially, then you begin slowly. You have 1% taken out of your paycheck for your employer’s 401(k). Soon you’ll realize you barely notice the difference. Then in a couple of months bump that up to 2%. In a couple more months, bump it up to 3%. When you get a raise, bump your 401(k) contribution up again. Soon you’ll be saving 10% or more of your salary for retirement.
Eventually You’ll Want To Hire A Fiduciary Financial Advisor
If you stick to your savings plan, in a few years, you may want to find a financial advisor with whom to work. The important thing to look for is a fiduciary advisor who, by law, must have your best interests in mind, not theirs. A fiduciary financial advisor is not interested in selling products. He or she is interested in helping you achieve your financial goals.
A first meeting with a financial advisor should reveal whether or not you will feel comfortable working together for the long term. Most importantly, you want an advisor who will listen to you while assessing your current financial situation and future goals. Over time you’ll discover your financial advisor becomes a trusted partner who helps you develop a comprehensive plan addressing all of your major areas of financial concern including retirement, college planning, insurance and more. They will provide advice as unexpected financial issues arise. (The pandemic was a doozy but many of our clients who were out of work managed to keet their heads above water by heeding our advice and have since regained their financial footing.)
The first wise step toward saving for retirement may seem daunting, but let me assure you, having a financial plan that you can stick with is one of the most rewarding things in life. Eventually you’ll see how easy it is to save and it will seem like your savings are growing faster than you could have ever imagined.
If you’re ready to the next step in your financial journey and look for a fiduciary financial advisor to work with, give our office a call. We started on our journey to help people achieve their financial goals for more than 30 years. We’d love to help you too.