It’s never too early to start saving for retirement. By accumulating as much as you can, as soon as you can, you can put time on your side—time to plan, time to weather the ups and downs of the market and, most importantly, time to let the power of compounding interest work for you.
How you maximize your savings will vary with age, but the following essential steps can help you get started.
- Maximize Your Contributions
Contribute as much as you can, but at least as much to take advantage of any matching employer contributions. If you don’t have access to a plan at work, consider an Individual Retirement Account (IRA) or other vehicle.
- Pay Off Debt
Find ways to reduce and/or eliminate as much personal debt as possible. Imagine how comfortably you could retire if you had no payments of any kind.
- Protect What Matters Most
Create a base of insurance to maintain your family’s lifestyle should something happen to you. This includes addressing life insurance, disability coverage and future long-term care needs.
- Identify Your Retirement Goals
Focus on the type of retirement you envision for yourself and then start to put a price tag on your dreams.
- Build an Emergency Fund
Aim to set aside at least six months of living expenses in a savings or money market account for unplanned expenses.
To start building financial security for the future, consider a mix of the following solutions:
- Disability insurance to protect your most valuable asset—your ability to earn an income.
- Life insurance to protect your family financially from a premature death or use living benefits to supplement your retirement income or help pay for a college education.
- Long-term care funding to help prepare for the cost of care that an illness, physical or cognitive impairment, or the lasting impact of an accident can require.
- Annuities to provide a stream of guaranteed* income that can last at least as long as you do.
- Mutual funds to help accumulate your retirement savings over time.
- IRAs to help build your nest egg on a tax-deferred basis for the future.
To learn more, contact a Northwestern Mutual Representative.
*Annuity guarantees are backed by the claims-paying ability of the issuer.