Tips To Help You Fix Your Retirement Savings Strategy and Start Saving Again

Have you recently stopped saving for retirement? Well, you're not alone. In April 2023, the TIAA Institute and George Washington University's GFLEC conducted a study on how the soaring inflation in 2023 affects workers and their retirement savings. The study showed that more than 25% of American workers cut their retirement savings in 2022 due to financial pressures caused by the highest inflation rate in more than 40 years.

But here's the good news: you have the power to restart your retirement savings and take control of your financial future. Let's explore some practical strategies that will help you build a strong retirement nest egg and pave the way for a fulfilling retirement. These three strategies are a great way to reboot your savings:

The Financial Reset: A Fresh Start for Secure Retirement

Doing a "Financial Reset" can be transformative in regaining control over your financial future and bolstering your retirement savings. Take a deliberate pause to assess and recalibrate your financial situation. Set clear financial goals and get clarity on your cash flow by creating or updating your budget. Finally, do some financial housecleaning by scrutinizing recurring expenses and identifying areas where unnecessary spending can be trimmed. This solid foundation will ensure you're on the right track as you reboot your savings.

Mindful Spending

It's time to reevaluate your spending habits and prioritize allocating funds to activities and purchases that align with your long-term goals and values. By adopting intentional spending habits, you can identify areas where you can reduce unnecessary expenses and redirect those funds towards your retirement savings. It's all about making choices that align with your financial goals and values.

Invest Time in Improving Your Financial Literacy

Improving your financial literacy and education is transformative. As you become more knowledgeable, you'll gain the confidence to make informed decisions, optimize your savings, and become less stressed about money. There are plenty of low-cost, fun, and engaging ways to improve your financial literacy. Try reading credible personal finance blogs, books (personally, I recommend Ramit Sethi's "I Will Teach You to Be Rich"), or checking out a personal finance podcast like "Money With Katie".

It's also beneficial to set up time with a certified Financial Coach or Accredited Financial Counselor®. They can help address any disabling money mindsets and behaviors, replacing them with productive financial habits. Working with a professional can provide personalized guidance and support on your financial journey.

Now, let's dive into some simple and specific tactics that will help you reboot your retirement saving habit:

Automate and Forget

Setting up automatic transfers from your bank account to your retirement accounts on a regular basis is the easiest and most obvious savings tactic to ensure consistency. By embracing the "automate and forget" mindset, you remove the temptation to spend before saving, allowing funds to flow steadily towards your retirement goals. Trust me, you probably won't even "miss" the money. Give it a try!

Micro-Saving: The Power of Small Contributions

Don't underestimate the power of "micro-saving" - making small, regular contributions to your retirement funds. It may seem insignificant at first, but over time, these small contributions can have a big impact on your saving strategy. Simply set aside a small fixed amount every day or round up your purchases to the next dollar and save the difference. This way, you can build up your retirement savings without straining your budgets. Many of my clients who practice micro-saving tell me they don't even notice the money being diverted from their checking accounts. You can do it manually or use helpful apps like Digits or Acorns.

The 30-Day No-Spend Challenge

Here's another idea: embark on a 30-day "no-spend challenge" where you commit to reducing unnecessary expenses for a month. Challenge yourself to spend as little as possible and use what you have on hand. By redirecting the money you would have spent on indulgences toward your retirement savings, you'll develop financial discipline and create healthy money habits for positive long-term lifestyle changes. To ensure you stay accountable and succeed with support, consider doing the challenge with friends. Set up a private WhatsApp chat group or Facebook group to share your struggles and successes.

The 'Second Act' Side Hustle

Consider exploring the idea of starting a "second act" side hustle to boost your income specifically for retirement savings. You can monetize a hobby, try freelancing, or offer consulting services. A side hustle can help you recharge your savings strategy and provide an additional source of income. Check out our blog for 100 side hustle ideas to get inspired.

Remember, every small step counts when it comes to recharging your retirement savings strategy. If you have any questions or need further assistance, I am here to help. Contact me to get started with financial coaching and take control of your financial future. Together, let's build a path towards a happy financial journey!