Investing. Just typing the word overwhelms me. I don’t begin to understand the process of how to buy stocks, which bonds to purchase, or what it means to my financial future when the Dow dips. Do you feel the same? I’ve done some research and found a few things you can do to supplement your retirement savings.
Pay loans off quickly
The faster you pay off debt, the sooner you can stash money into a retirement plan. Student loans, car payments, mortgage, credit cards, etc. all keep your money tied up. When you get “free” money: a cash bonus, cash gift for you birthday, tax refund, etc. use it to make an additional payment on your loan. Since you weren’t counting on that money, you won’t miss it.
Invest in your company’s 401k
If your company offers matching contributions, contribute the maximum amount you can afford. It’s free money. Take full advantage of that benefit. Start as early in your employment as possible. If you’re concentrating on paying off debt, make the minimum contribution. When you are debt free, increase your 401k contributions by the monthly amount you were paying your creditor.
Open an Individual Retirement Account (IRA): If you are eligible, this is the traditional route. I thought an IRA was an investment, but it’s actually a savings account with tax breaks attached. It’s unwise to rely solely on a pension and Social Security to fund your retirement. Every day people are celebrating their 100th birthdays. Plan accordingly.
Invest in real estate
If you’re a gambler, you may enjoy real estate crowdfunding. Which is essentially pooling your money with other people’s money to purchase properties that someone else manages and or sells. It’s not a huge return on your investment, but you may like it better than stock trading.
Use a micro-investment app
The concept of rounding up the amount of a purchase to the nearest dollar, then diverting that difference into an investment account is brilliant. Acorns, Stash, Robinhood, and WiseBanyan have figured out how to do it. Using this method of investment won’t provide huge returns, but if you keep spare change in a jar on the kitchen counter, it’s not working for you. You may as well have a little bit of money making you a little bit more money.
Get a side gig
This can be as intense as working retail or as laid back as dog walking. You can work for someone else, like a big box store. You can work for someone else while setting your own schedule, like being a ride share driver. Maybe it’s time to launch your own business, like online guitar lessons. If you have a skill you can monetize, you can put that money in your retirement fund. As an additional benefit, you set yourself up for having a stream of revenue when you retire from full time employment. Exploring your options while working full time sets you up for life beyond the daily grind.
There are numerous ways you can save for retirement. Investing can be as complicated or as easy as you want to make it. The important thing is to do something to financially provide for your future.
What kind of investing do you do? Please share in the comments section.