NORFOLK, Va. - Are you saving for retirement? If not, experts say now is a great time to start.
October is Financial Planning Month and Kevin Zywna, a Certified Financial Planner with Wealthway Financial Advisors, says while spending more now can be enticing, it's also important to look ahead.
"We have a savings crisis in this country. We have a retirement savings crisis because not enough people are thinking long term," Zywna tells News 3.
Zywna points to five steps that help set up long term success:
- Change behavior: Zywna suggests saving today to have more tomorrow. An example would be bringing coffee and lunch from home instead of eating out.
- Avoid bad debt: According to Zywna, bad debt is anything with an eight percent interest rate or more, pointing specifically to credit card debt and high-interest loans.
- Build an emergency fund: Set aside money to cover 3-6 months of expenses in an account that's readily accessible. "What COVID brought home from a financial planning perspective is that you need to have a good solid financial foundation under you in case of an emergency and that means typically an emergency fund," Zywna said.
- Contribute to a retirement fund: Zywna says most employers have retirement plans to which their employees can contribute funds each paycheck. Often times, the employer will match up to a certain point. It's free money.
- Invest retirement contributions: According to Zywna, investing retirement funds in stocks or equities will help the money grow. He suggests leaving it invested regardless of what the market it doing at a particular point in time.
That's a lot of places to put money and understanding that we don't always have the extra cash to save, Zywna still says to do what you can.
"Just starting the process with a little bit will eventually get the snowball rolling and become larger and larger down the road but you have to make that lifestyle commitment first," he said.
And remember, no matter your age, it's never too late to start saving.