How to Prepare for Retirement Financially: Seven Tips for a Secure Future

Senior couple smiling and happy after researching how to prepare for retirementWhether you’re close to retiring or at the beginning of your career, it’s never too early to think about retirement. The sooner you plan and put things into action, the more choices you’ll have in your golden years.

For some people, planning for retirement is complicated - that’s why Clark County Credit Union is sharing seven tips that anyone can easily follow to secure their retirement.

1. Commit to saving for your retirement

The great thing about saving is it’s a rewarding habit. The sooner you start, the more time your money has to grow. Make saving for retirement a priority, create a plan and stick to it.

If you’re not convinced yet, make sure to read The Importance of Planning and Saving for Retirement.

2. Analyze your retirement needs

To maintain your standard of living, experts estimate that you will need 70 to 90 percent of your pre-retirement income when you retire. Start by creating your monthly budget and ensure your basic needs are covered. Make sure to use our free budget calculator when you are budgeting.

3. Contribute to a 401(k) plan

Aside from the retirement savings opportunity, some employers match their employee’s 401(k) contributions. Over time, this can really boost and make a big difference in your retirement plan.

If you’re just starting with your first real job, it’s important to understand why contributing to a 401(k) is beneficial for your future – Meet Your 401(k).

4. Check out your employer’s pension plan

Another retirement plan you can take advantage of is your employer’s pension plan. A pension plan is funded by your employer while a 401(k) is funded by you (the employee) and may have a matching contribution from the employer.

Speak with your employer’s benefits specialist and see if you are eligible for it and understand how it works.

5. Let your 401(k) money grow

Regardless of your financial situation, it’s best not to withdraw your retirement money. Withdrawing your retirement savings early may result in losing tax benefits and paying a penalty.

6. Open an Individual Retirement Account (IRA)

Another great option to help improve your retirement is to open an IRA account. In 2023, IRA participants can contribute up to $6,500 each year. You can start small and increase your contribution later. When you decide to open an IRA account, you have two options – a traditional or Roth.

A traditional IRA is tax-deferred which means you can contribute money before it’s taxed, and you won’t owe taxes on those contributions or earnings until you withdraw money. On the other hand, a Roth IRA is not tax-deferred. This means you will owe taxes when you contribute to the account, but it also means that you won’t have to worry about paying them later and your contribution can grow tax-free.

Visit our IRA account page to learn how CCCU can help you save for your retirement.

7. Get professional help

While it’s good to read and research how to plan for your retirement, it’s still best to work with a professional that can understand your current financial situation and your retirement goals so they can provide you with practical advice.

Since 1951, our credit union has been helping our members reach their financial goals. In addition to our Investment Center, our members can take advantage of our money-saving accounts and retirement solutions that fit their needs. Not a member yet? Call us at 702-228-2228 or get started with your CCCU membership application today!