Maximize Your Retirement Plan
To Do This Year:
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- If you have stopped contributing to your retirement account, start again immediately.
- If your employer offers a 401(k) or similar retirement plan, make sure you're signed up and contributing. If you don't have a 401(k) at work, you should have your own IRA.
- Know exactly where your money is invested. Pull out your retirement account statement and find out what your savings are invested in.
- Using Morningstar.com, compare your investments' performance to others in the same asset class.
- Determine what level of risk you're comfortable with—and what's right for someone your age. Then make sure your investments reflect that.
- Consider "target date" mutual funds so you don't have to rebalance your investments yourself every year.
- If you don't feel comfortable making these decisions yourself, get help from a qualified financial professional. Ask your employer if your plan offers a free or fee-based advisory service, or find one from the several recommended in this chapter.
- Increase your retirement contributions today, and if you don't feel the pinch, raise them some more. Your goal is to reach the maximum contribution allowed.