3 End of The Year Retirement Savings Check Up Questions

saving and retirement Follow Me on Pinterest Saving for retirement is no easy task. We’re quickly approaching the end of another year of our lives and that brings us all one year closer to retiring. That’s why now is a perfect time to check and make sure you’re on track for retirement! Here are a few yearly check up questions than can help you reach your retirement goals.

Are You Where Your Retirement Plan Says You Should Be?

Everyone should have a retirement plan. If you don’t, the first step is getting one! If you are responsible and have a plan, where does it say you should be this year?

There are two answers to the question, you’re either where you should be or you aren’t. The important thing about this question is why the answer is what it is. Are you not where you should be because you aren’t contributing enough money, or was there a recent market downturn?

Depending on how many years away from retirement you are, the answer to this question may require urgent action or waiting out the current downturn.

The key is to know where you are in relation to your goals and why you are where you are. Once you know that, you can formulate a new action plan to get back on track or continue with your retirement savings successes.

You can also check out this resource from Genworth Financial to see if you’re ready for retirement.

Are You Happy With Your Savings Rate?

Your retirement savings rate is my favorite predictor of retirement savings success. The more you save as a percentage of your income, the less income you’ll need in retirement if you keep your lifestyle the same. Unfortunately, savings rate definitely isn’t the only factor in retirement success.

Even if you’re on track with your retirement plan, it may be because you got lucky this year with a major increase in your investment returns. If that is the case, the recent returns may not be what you’ll receive in the future.

You may want to look into increasing your savings rate so that you’ll stay on target with your retirement plan even when markets don’t perform as well in the future as they have in the last couple of years.

Did You Increase Your Contributions With Your Raise?

This is my favorite way to increase my retirement savings rate. Every year when I get a raise, I put half of it toward retirement savings. That means if I get a 2% raise at work this year, I’ll increase my retirement contributions by 1% of my total salary.

Some workplace retirement plans allow you to sign up for an automatic increase program. If your workplace offers this option, then you’ll definitely want to consider signing up.

Whenever processes, such as increasing your retirement savings rate, are automated there is a much more likely chance that the action will happen. Chances are you might not even notice the money missing from your checking account!

If you’re close to retirement (age 50 or older) make sure to check out this resource from US News on 12 important retirement planning deadlines.

Whether you’re close to retirement or it is 40 years away, make sure you ask yourself these retirement savings check up questions every year. You’ll be glad you did!

Do you have any other retirement check up questions you ask yourself? I’d love to learn about how you do your yearly retirement checkup. 

This post was inspired by Genworth Financial. All opinions are 100% my own.

photo by: 401(K) 2013

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About Lance Cothern

Lance Cothern, a Certified Public Accountant (CPA) licensed in the Commonwealth of Virginia, is the founder of Money Manifesto. You can read more about him here or connect with him on Facebook, Twitter, Google+ or Pinterest.

Comments

  1. End year is certainly a prime occassion to evaluate ones progress with regards to the retirement plans and financial goals in general. I like the questions you suggest, they drill in on the essential parts of building up a retirement fund and occassions reflection on the direction one has been taking and the changes they ought to be making.
    For one, I haven’t contributed more with my raises so thats an area I need to focus on!

  2. Yeah, I feel like I did pretty good retirement-wise this year. But, next year I’m going to contribute monthly instead of in lump sums.

  3. Thanks for the reminder. I need to max out my ROTH for the year!

  4. I usually review my investments in December every year. I look at asset allocation and a few other things for the new year.

  5. My big move with retirement at the end of every year is seeing if I’d like to change up my investments. I’ll usually review the returns, expenses, and then look at my overall asset allocation to see if I should make any modifications.

  6. Bryce @ Save and Conquer says:

    I like the put at least 1/2 of any raises into retirement savings tip. I have done that and more throughout my working career. My wife and I are on track to retire in 9 years.

  7. Since the hubs and I are already retired, we can’t contribute to our retirement plans, other than continuing to re-invest the earnings. But we still contribute to our taxable savings/investment accounts each month. Regarding your question about are we happy with our savings rate….do you mean amount we contribute or the yield we are earning? I’m happy with our savings contributions but due to the low interest rates due to the Fed, no one can be happy with the yield. So we put more into the investment accounts rather than the savings accounts – which are two different animals.

  8. My answers here aren’t exactly the best – retirement savings were not a huge priority for me this year I guess. But luckily I’m still in my 20s and have some time. :)

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