Are you already saving for your retirement? Can you already imagine how you will spend it in the future? It’s not unusual for anyone to save up early or keep multiple savings accounts to ensure that they’ll have enough money upon retirement.
There are only a few legit ways to speed up the growth of your savings. So, if you’re looking for ways to maximize your retirement fund, this article lists down six ways for you to triple your savings for the future.
- Invest In Precious Metals
Investing in precious metals is not just about buying and selling gold bars or jewelry, you can also invest through exchange-traded funds (ETFs) or buy stocks from mining companies.
Investing in precious metals usually pertains to gold or silver investments, but you can also invest in other metals like platinum. Silver coins are also valuable and are more affordable than gold, making them great starters for beginner investors.
If you opt to invest in physical gold, you need an IRS-approved custodian like Oxford Gold to hold or secure the gold for you. Gold is an excellent protection against inflation, and its value is not generally affected by economic downturns.
- Take Advantage Of Compound Interest
Preparing for retirement or any other long-term financial goal requires patience and discipline. However, it also pays to research and make the best decisions as to where you must put your hard-earned savings.
Before choosing a bank or investment vehicle, pick the type that gives you the best interests for your savings. Your savings or investments might seem small at the moment, but if you religiously add money into it, you can take advantage of the compounding interest and enjoy a comfortable retirement after a decade or two.
For example, if you invest USD$100,000 today with a six percent interest per annum, you will get USD$320,714 in total after 20 years. And if you continuously add money into the fund, it can grow your money even more.
For example, if you add USD$5,000 annually (aside from your initial deposit of USD$100,000), you will have a total of USD$504,641 after 20 years. That’s a total of USD$304,641 earned in interests!
- Contribute More To Your 401(k)
If you have a 401(k) from your company, you can opt to contribute a higher portion of your salary to boost your savings. Even better, if your employer can shoulder the first five percent of your salary, for example, then you can top up more to increase your savings. Just be mindful of the contribution limit.
- Invest in Mutual Funds, Stocks, or Bonds
Aside from your regular savings, 401(k) contributions, or precious metal investments, it also pays to explore other financial instruments such as bonds, stocks, and mutual funds. While these three are lumped together, they are not essentially one and the same.
Mutual Funds refer to money pooled from various investors that are used to buy or invest in various stocks and securities through a fund manager. Bonds, on the other hand, are funds pooled for government and corporation loans. The investor earns through the interests paid from these loans. Lastly, stocks pertain to shares or units from a commercial business or enterprise. The investor earns when the value of the business increases.
Among the three, stocks are the most volatile because the value of businesses can rise and fall at any period. For long-term financial goals like building a retirement fund, mutual funds and bonds are safer options. Stocks are still great forms of investment as long as you take the time to study the market and take huge risks.
- Make Practical Decisions To Save
Do you have money-lies you tell yourself every time you have something to spend? You’ll do well to list your regular expenses and think if you can do without a few things. If you’re fond of going out for branded coffee, make your own at home instead. You can also search for home exercises or create a low-cost home gym to save gym membership money. Learn to shop for deals and search for easy recipes instead of dining out. Cutting costs is a great way to set aside more money for your savings.
Tripling your savings for retirement and long-term plans won’t be an easy road. You have to be patient and disciplined enough with your money to end up with a sizable nest egg. The good thing is that you have many options when it comes to investing or saving money. You can either choose to establish a sizable savings account and contribute more to your 401(k), or invest in precious metals, stocks, bonds, or mutual funds. Remember, it’s best to diversify and not put all your eggs in one basket.