Planning 9 tips for a successful retirement

A solid retirement strategy may often be at the core of your financial journey. There’s a lot more to retirement planning than contributing to your 401(k) at work. In addition to various retirement accounts, personal finance strategies like an emergency fund or a health care savings account may also be part of a successful retirement strategy to help your retirement savings run smoothly even if unexpected expenses come up. Here are some ideas to help stay on track and achieve the retirement lifestyle you want:

Save early and earnestly

One important thing you should consider is to aim to save at least 15% of your pre-tax income every year. In particular, consider the following actions:

• Contribute the maximum allowable amount to your employer’s retirement plan (e.g., 401(k), 403(b) or 457(b)). And if your employer matches contributions, even better.
• Establish a traditional Individual Retirement Account (IRA). As with the employer-sponsored plans mentioned above, traditional IRAs also enable you to save on a tax-deferred basis. With this type of account, annual contributions may be tax-deductible depending on your (or your spouse’s) income level and whether you (or your spouse) are covered by a retirement plan at work.
• If you have access to a Roth 401(k) or qualify for a Roth IRA, using these potentially tax-free accounts can give you greater flexibility to manage your tax picture through retirement
• A SEP, SIMPLE or Individual 401(k) plan is a tax-advantaged way for small business owners to save
• Don’t forget about taxable investment accounts to round out your savings

Try not to overspend

The less you spend, the more you can save and invest for growth. Get an understanding of how you are spending your income and consistently review to make sure you know where you stand. A byproduct of lower spending is that you have a more achievable lifestyle that your savings are more likely to be able to cover.

Build an emergency fund

Having three to six months’ worth of living expenses set aside in a savings account may reduce the possibility of having to tap into your retirement funds and disrupting long-term goals if something unexpected happens.

Catch up contributions

There may be ways to contribute to the retirement you want, no matter your age. Being age 50 or older may allow you to contribute extra money to various retirement accounts to catch up on savings. The table below outlines limits on catch up contributions that may be permitted in the respective retirement plan or account in 2025.¹ These amounts are in addition to the regular contribution limits.

If the 403(b) plan allows, an employee who has worked for a qualified organization for 15 or more years may, if he or she meets certain requirements, be able to make additional contributions of up to $3,000 for up to 5 years. For more information go to IRS 403(b) website and see 15-year rule in Publication 571, Tax-Sheltered Annuity Plans (403(b) Plans) under Contributions

Understand Social Security and pension benefits

Knowing your Social Security and pension payouts can clarify how much additional retirement income you need from your investments. And when you file for Social Security benefits can make a big difference.

Invest more of what you save

It may feel “safe” to keep your money in cash or CDs. However, a well-diversified investment portfolio may provide higher returns over the long term that can help you outpace inflation.

Make saving automatic

One way to do this is by “paying yourself first” – have a certain dollar amount taken out automatically from each paycheck and deposited into your retirement plan.

Plan for retirement health care costs

Better lifestyles and health care mean most of us will live into our 80s, 90s and possibly beyond. But health care cost growth and those extra years can add up to higher medical costs later in life.

Review your goals annually

Smart investing for the long term takes time, thought and patience. Whether you invest independently, or work with an advisor, review your changing needs and goals at least annually and refine your portfolio as needed in order to stay on track for the retirement you want.