Financial advice is often directed at the very young or very old: spend less than you earn every month, and don’t put too much of your retirement savings in stocks as your retirement progresses. But what about the rest of us – those of us in our working years who are approaching retirement? Here are five tips to keep us on track.
Track your income and expenses. Do it while you’re working. Do it in retirement. Knowing what you earn and what you spend is the key to financial freedom.
Save part of your income every month. In your working years, save for retirement. In your retirement, save for a rainy day. Take advantage of automatic paycheck deductions, if they’re available.
Take advantage of your employer’s tax-savings plans. If you have a 401(k) plan, a pretax transportation plan, or a health savings account, use them. Every little bit of tax savings helps.
Be diligent. Open bills when you get them. Review your bank and credit card statements for errors. Pay your bills on time (and online when possible; it can help keep you on track). Pay attention to interest rates on mortgages and other loans. Plan your dinner menus in advance, and shop accordingly. Read all contracts before signing.
Don’t overspend. Keep the money in your wallet to a minimum. Avoid buying on impulse by making a shopping list and sticking with it. Gifts are no exception. They may seem like they don’t count, but your generosity shouldn’t threaten your financial security.