By Steve Seals
Are you worried that you haven’t been diligent enough with your retirement planning or saved enough? You’re not alone. A recent Bankrate survey found that 21% of American workers regret not having saved early for retirement.
But don’t fret. It’s not too late to save more for your retirement.
If you’re a Toyota Motor Manufacturing employee, there are several things you can do right now to begin catching up on your retirement efforts.
Pay Off Your Debt
One of the best ways to accelerate your retirement efforts is to assess your debt—including credit cards, auto loans, and mortgages—and begin paying it down. Start with the obligations that have the highest interest rates and work your way down. As you pay off each debt, you can put the money you save toward your retirement.
When it comes to retirement planning, even your mortgage can play a role. Once you’ve paid off other debts, consider putting more toward your monthly mortgage. If you knock off five, 10, or 15 years of your mortgage, that’s money to sock away for retirement. You’ll also be able to count your home as an asset in retirement.
Reduce Discretionary Spending
Now is the time to start eating more meals at home, cancel those impromptu weekend getaways, and stop buying coffee or tea while you’re out. Slashing your discretionary expenses, even if it’s just a few dollars here and there, can bring you that much closer to retirement.
At this stage, your retirement planning calls for tracking your spending. Keep a record of all spending, cut out anything unnecessary, and put the extra money in savings. You’ll be glad you did.
Save Any Extra Money You Receive
It’s also a good idea to funnel any additional money that comes your way into your retirement savings, whether it’s a bonus, tax refund, or inheritance. Doing so can allow it to begin compounding right away. The longer your money earns interest, the more you’ll have when you stop working.
Increase Your Income
Increasing your income could mean getting a pay raise as a Toyota employee or taking on a side gig, like tutoring or delivering take-out orders. Such a change could be a short-term strategy to pay off debt and stash away additional savings for retirement, or it could become something more permanent, like switching to a position that pays better.
Before making any momentous changes to your job situation, consider talking to a financial services firm like Seals Financial Planning & Investments.
Max Out Your 401(k)
No matter when you do your retirement planning, try to contribute the maximum amount allowed for your 401(k) annually. For 2024, that’s $23,000. If you’re 50 or older, you can contribute an additional $7,500.
By contributing more to their 401(k), Toyota employees also can take advantage of the company’s generous match, which is like getting free money.
Consider Adding an IRA to Your Retirement Planning
Opening a traditional individual retirement account (IRA) or Roth IRA can give Toyota employees more ways to save, with attractive tax advantages. The annual contribution limit is $7,000 for the IRA and Roth IRA. If you’re 50 or older, you can squirrel away another $1,000.
With the traditional IRA, you save pre-tax dollars and get to deduct the amount on your tax form, meaning your money grows tax-deferred until you take distributions. With the Roth IRA, you save after-tax dollars that grow and are distributed tax-free.
Kick-Start Your Retirement Planning
If you’re looking to ramp up (or simply start) your retirement planning efforts, Seals Financial Planning and Investments can help. Our financial planning services firm is dedicated to our clients’ financial success, growth, and overall well-being.
Please give us a call at (859) 230-3476 if you would like to schedule a time to meet.
About Richard Stephen (Steve) Seals
Steve Seals is owner and independent Registered Investment Advisor Representative at Seals Financial Planning & Investments VI, LLC, a financial planning services firm based in Lexington, KY. As an independent Registered Investment Advisor Representative with about two decades of experience in the investment and insurance industries, Steve’s firm is founded on getting to know each client personally, allowing him to provide sound financial advice throughout their career and into retirement. With the mission of guiding clients on the path of success, Steve is fueled by his commitment to excellence and goes the extra mile to make sure clients are fully satisfied. He believes in maintaining a positive mindset, creating partnerships with a purpose, and always striving for significant outcomes.
Born in Jenkins, Kentucky, Steve grew up with a love for basketball and serving his community. After high school, he served nine years in the United States Marine Corps, then earned a bachelor’s degree in accounting. He was eventually able to put his degree and desire to help others to work as a fiduciary financial planner. Prior to founding his own firm in 2014, Steve learned from working with Edward Jones, US Bank, University of Kentucky Federal Credit Union, and CUSO Financial. He also received his Security Series 63 and 65/66 through Keystone Financial Group, LLC, and holds various life, health, and variable insurance licenses.
Steve and his wife, Angie, have three daughters (Lauren, Peyton, and Ashton) and two grandsons (Kenyon and Kai). Steve holds a private pilot’s license, and the family enjoys sports, spending time at the lake, and traveling. To learn more about Steve, connect with him on LinkedIn.
