Give Your Savings an Attitude Adjustment

The prospect of having to amass seven digits worth of money to cover your retirement can be so daunting that you might feel tempted to abandon all hope. You’ll regret it if you don’t save for the future, so today you might need to give your savings an attitude adjustment. Here’s how to do just that.

Free Yourself from the Cycle of Debt

Resolve not to borrow another penny — except for your car and mortgage — and pay off everything else. Close your credit card accounts, pay off the balances, and get a debit card for all future purchases. If you still have outstanding student loan debt, try to pay it off early. All of this should force you to live within your means.

Become the Early Bird

The earlier you start saving for retirement, the more time your investments can accrue value. Time is one of the most effective tools in your retirement savings arsenal.

Invest First, Spend Later

If you get paid every two weeks, allocate as much of your non-rent-paying paycheck as possible toward your retirement savings — even if it means manually adjusting the contribution amount twice a month. Whatever you have left after that becomes your budget for food and other living expenses.

The invest-first approach is easiest to accomplish using a retirement plan. Make a point of maxing out any retirement plan offered by your employer. You can also set up automated contributions to a Roth IRA.

Save for Emergencies

All too often people neglect to set aside an emergency fund and then have to dip into retirement savings or take out a loan when something unexpected comes up. Try to set aside at least the equivalent of one paycheck to make sure you don’t have to pay interest and penalties on any borrowing to cover surprise expenditures.

Give Your Savings an Attitude Adjustment

The suggestions in this article only scratch the surface. Once you master them, there’s always more to learn and bring to fruition. Make personal finance your hobby and saving will become second nature — the best attitude adjustment you could hope for.

Readers, what are your new savings goals?

Jackie Cohen

Jackie Cohen is an award winning financial journalist turned turned financial advisor obsessed with climate change risk, data and business. Jackie holds a B.A. Degree from Macalester College and an M.A. in English from Claremont Graduate University.