Building a financial plan requires many different elements.
Today I will go over the importance of having a disciplined retirement plan.
I like to use the word disciplined because to me it means structure.
Over the years I met with people who never followed a specific plan.
Most saved the bare minimum of $25 or $50 a month, which will not achieve financial independence.
Saving sporadically or in little amounts will not accomplish your retirement goals.
The people who followed a disciplined retirement plan did not save thousands per month.
Most people save between 10% up to 20% of their paycheck so they can achieve financial independence.
Part of their disciplined approach was to increase the amount they saved each year.
Most did not start at the high dollar amount they currently save, but they did increase their savings each and every year.
How to Increase Your Savings One of the tips I received from a couple was when they paid off a credit card they used the payment to pay themselves instead of the bank.
Instead of going out and getting more debt they used the payment to build their retirement savings.
How often have you paid off a small credit card with a $30 payment? The $30 is easy to spend again by building up the credit card balance, but just as easy to save.
Saving money for retirement is not difficult as long as you follow a disciplined retirement plan.
Free Money From Work Take a look at your work retirement plan.
The most common retirement plan is a 401k plan.
If your employer offers a 401k plan you should see if they offer a company match.
A company match is sort of like a pay increase except the money is kept in your retirement savings account, the 401k plan.
A common company match is 3%, which means if you save 3% of your paycheck in the 401k plan then your employer, will also pay 3% into your account.
It amazes me how many people leave a 3% pay raise by not saving money for their retirement.
Do not give up a pay increase because you have too much debt.
Pay off the debt then start receiving your employer's company match.
Buy When Stocks are On Sale Take some time to review your quarterly statements to see if any investment needs to be adjusted.
Do not be influenced by the performance of the stock market every single day, month or quarter.
The stock market will go up and will go down.
A disciplined retirement plan is looking at the long term, 5 to 10 years down the road.
Too many people look at what is happening today, when they should be worried about 10 years or more.
What you need to review every quarter is the amount of shares you accumulated for the quarter.
When share prices are down you will be buying more shares than when the price is increasing.
Do you like to buy things when they are on sale? Of course we all like to buy things for sale.
When the stock market is down you are buying shares when they are on sale.
When are stocks on sale? Unfortunately we do not know when stocks will be on sale or at a low price.
However, if you follow a disciplined retirement plan of saving every month you have a better chance of buying stocks on sale.
The reason is you would be buying shares every single month and some months prices will be high and some months low.
Final Thoughts A disciplined retirement plan is not easy at first, but with time it will become easy.
Trying to lose weight is never easy, but once you begin a healthy lifestyle losing weight becomes easier.
Saving money is similar because you are developing a new habit.
Investing money for retirement takes time and dedication.
Remember we are building your financial destiny one brick at a time.
Today I will go over the importance of having a disciplined retirement plan.
I like to use the word disciplined because to me it means structure.
Over the years I met with people who never followed a specific plan.
Most saved the bare minimum of $25 or $50 a month, which will not achieve financial independence.
Saving sporadically or in little amounts will not accomplish your retirement goals.
The people who followed a disciplined retirement plan did not save thousands per month.
Most people save between 10% up to 20% of their paycheck so they can achieve financial independence.
Part of their disciplined approach was to increase the amount they saved each year.
Most did not start at the high dollar amount they currently save, but they did increase their savings each and every year.
How to Increase Your Savings One of the tips I received from a couple was when they paid off a credit card they used the payment to pay themselves instead of the bank.
Instead of going out and getting more debt they used the payment to build their retirement savings.
How often have you paid off a small credit card with a $30 payment? The $30 is easy to spend again by building up the credit card balance, but just as easy to save.
Saving money for retirement is not difficult as long as you follow a disciplined retirement plan.
Free Money From Work Take a look at your work retirement plan.
The most common retirement plan is a 401k plan.
If your employer offers a 401k plan you should see if they offer a company match.
A company match is sort of like a pay increase except the money is kept in your retirement savings account, the 401k plan.
A common company match is 3%, which means if you save 3% of your paycheck in the 401k plan then your employer, will also pay 3% into your account.
It amazes me how many people leave a 3% pay raise by not saving money for their retirement.
Do not give up a pay increase because you have too much debt.
Pay off the debt then start receiving your employer's company match.
Buy When Stocks are On Sale Take some time to review your quarterly statements to see if any investment needs to be adjusted.
Do not be influenced by the performance of the stock market every single day, month or quarter.
The stock market will go up and will go down.
A disciplined retirement plan is looking at the long term, 5 to 10 years down the road.
Too many people look at what is happening today, when they should be worried about 10 years or more.
What you need to review every quarter is the amount of shares you accumulated for the quarter.
When share prices are down you will be buying more shares than when the price is increasing.
Do you like to buy things when they are on sale? Of course we all like to buy things for sale.
When the stock market is down you are buying shares when they are on sale.
When are stocks on sale? Unfortunately we do not know when stocks will be on sale or at a low price.
However, if you follow a disciplined retirement plan of saving every month you have a better chance of buying stocks on sale.
The reason is you would be buying shares every single month and some months prices will be high and some months low.
Final Thoughts A disciplined retirement plan is not easy at first, but with time it will become easy.
Trying to lose weight is never easy, but once you begin a healthy lifestyle losing weight becomes easier.
Saving money is similar because you are developing a new habit.
Investing money for retirement takes time and dedication.
Remember we are building your financial destiny one brick at a time.
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