Couple in their 30s looks at phone and plans for retirement

How to Plan for Retirement in Your 30s

Whether you’re playing catch-up or fine-tuning established investments, your thirties are crucial years for strengthening your financial future. Consider these tips to help make your road to retirement a bit smoother.

Know Your Investment Options

Whether you’ve already been saving for retirement or you want to get started, it’s important to be aware of your retirement investment options.

According to Arielle O’Shea of NerdWallet, a work 401(k) account is a great place to start. You can contribute up to $18,000 a year toward retirement on a pre-tax basis. Many employers offer matching contributions up to a certain point — this is free money, so if possible, try to take full advantage of it.

If you don’t have access to a 401(k), or if you’ve maxed yours out and want to save even more, consider an individual retirement account, or IRA. For example, with a Roth IRA, you can contribute up to $6,000 per year.

Related: Should I Save or Invest Money? >>

Make Savings Automatic

No matter the account you opt for, Stacy Rapacon of Kiplinger recommends funneling at least fifteen percent of your income into retirement savings.

Per U.S. News & World Report contributor Abby Hayes, automating your savings is an easy way to put more toward retirement. If you have a 401(k), your savings are already automatic. You can also set up regular direct deposits into an IRA. Or, download an app like Qapital or Digit to automatically save small amounts, then deposit that money in a retirement account.

Accept Risk — But Embrace Diversification

In your thirties, you’re still several decades away from retirement. Writing for Bankrate, Leslie Haggin Geary points out that this distance allows you to invest your savings more aggressively. Instead of anxiously watching as markets go up and down, you can think for the long term and allocate the vast majority of your investments toward stocks.

At the same time, it’s wise to maintain diverse investments. Rapacon notes that index mutual funds are an especially effective way to invest in a broad, stable range of stocks while still leaving plenty of room for growth.

Related: Should I Invest in Stock or Mutual Funds?>>

Get Debt Under Control

If you’re in your thirties and owe a great deal of student debt or credit card debt, you’re not alone. However, it’s important to have an aggressive plan for paying off your debts so you can put more of your money to work for your retirement.

Should you wait to invest until you pay off debt? Not necessarily, according to Hayes. If the rate of return for your investments is higher than your debt interest rate, you may want to prioritize retirement savings.

Related: What Should I Do First: Pay Off Debt or Save for Retirement? >>

Stay Informed and Engaged

You can “set and forget” certain aspects of your retirement savings, but make sure you remain informed about what your money is doing.

Log onto your online accounts regularly to make sure your investments are properly allocated. Research the funds you’ve invested in to make sure that fees aren’t eating up your returns. Even more importantly, make sure that you set specific goals for your retirement and review your progress regularly.

You’ll also want to consider meeting with a financial advisor to assess these goals and maximize the effectiveness of your investment strategies.

Related: Don’t Leave Your Retirement Savings Behind >>

Make Retirement Planning Easier with Minster Bank

As a thirty-something adult, you won’t be retiring anytime soon — but it’s still important to prioritize planning for that stage of life. Informing yourself about investment options, maximizing your savings, and setting balanced financial goals are great ways to build wealth and achieve greater financial security for your retirement years.

We have several retirement plan solutions for individuals and employers. Learn more about our options and see how we can help you prepare today for the retirement you’ve always wanted.

See Our Retirement Plans >>

 

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