Take five minutes to review four key numbers that can help you understand your retirement readiness and identify opportunities to strengthen your financial future.
Every year, 401(k) Day serves as a reminder to pause and take a quick look at your retirement savings. Are you still on track for the future you envision?
The good news is that gaining a clearer picture of your retirement readiness doesn’t have to be complicated or time-consuming. In fact, just five minutes can help you identify opportunities to strengthen your financial future.
This 401(k) Day, take a few moments to review four important numbers that can help you better understand your retirement readiness.
1. Your Contribution Rate
Do you know what percentage of your paycheck is going into your retirement account?
Your contribution rate is one of the most important factors in determining how much you’ll have saved for retirement. If your employer offers a matching contribution, it’s also worth checking that you’re contributing enough to receive the full match. Otherwise, you could be leaving free money on the table. Even increasing your contribution by just 1% can make a meaningful difference over time.
2. Your Account Balance
How much have you saved so far?
Look at the balance in your retirement account and note your vested balance. If you’ve changed jobs over the years, you may also have retirement accounts with former employers, be sure to review those balances as well. Managing multiple accounts can be challenging. Consolidating old retirement accounts may make it easier to track your savings and stay organized.
3. Your Planned Retirement Age
You don’t need to know exactly when you’ll retire, but having a target age in mind can help guide your planning decisions.
Whether your goal is age 60, 65, or beyond, setting a retirement target gives you something to work toward and can help you evaluate whether your current savings strategy aligns with your long-term goals.
4. Your Rate of Return
Your account’s rate of return provides insight into how your investments have performed over time.
While investment performance varies and past results don’t guarantee future outcomes, understanding how your account is performing can help you determine whether your current investment mix aligns with your goals, time horizon, and comfort level with risk.
While each of these numbers tells part of the story, together they provide a more complete picture of your retirement readiness. The key is not just knowing the numbers, but using them to make informed decisions about your future.
Put Your Numbers to Work
Knowing your numbers is a great first step. The next step is understanding what those numbers mean for your future.
Log into your retirement account and use the Mile Marker tool to run retirement projections. You can estimate future monthly retirement income and see whether you’re on pace to meet your retirement goals.
Small actions taken today can have a meaningful impact on your future financial security.
This 401(k) Day, take five minutes to check in on your retirement savings. Your life in retirement depends on today’s choices.