No matter what age you are and how much money you have put aside you should spend a bit of time every year to evaluate where you are in your retirement savings process and how much more you have to go before you reach your retirement goal. Planning for the future and taking active steps to gain control will lead you to financial success.

Have a Retirement Check Up

Gather your latest statements for your 401(k) statement, your savings accounts, your Roth IRA, and the latest Social Security benefits summary you have received and get in front of a computer. There are many calculators available online where you can input your age, your total savings, how large of a nest egg you are targeting, and when you plan to retire. The calculator will show how close you are to hitting the mark or what rate of return you need to hit that nest egg number. Fidelity provides a Retirement Quick Check which will calculate how much you need to put aside monthly to achieve a retirement income you’ll need.

Tweak Retirement Savings to Hit Your Goal

After you evaluate where you stand regarding retirement follow these steps to ensure that you are putting enough money away for the easy and painless retirement.

1. Max out annual contribution for your IRA and 401(k).

Retirement SavingsIf you are under 50 years of age you need to make sure that you make the maximum contributionfor your Traditional or Roth IRA by the cut-off date, or you are out of luck. Make sure to get every penny of your employer’s contribution into your 401(k). Employer matching contributions are essentially free money, so make sure to take full advantage of this. If your employer offers to match your contribution to your 401k then max out your contribution at least up to where the employer match runs out. You won’t miss the money from your paycheck but will be happy to see it when you reach retirement.

2. When changing jobs don’t cash out your retirement.

It’s been predicted that the current generation will change jobs much more frequently than any other previous generation. Many of us will change jobs and foolishly cash out our 401(k) from the previous company. You should never cash out your retirement account when you change jobs. Instead of cashing out, roll over your 401(k) into the new company’s retirement plan. If that is not viable then open an IRA account and roll over the money into this. You’ll avoid having to pay the large tax and early withdrawal penalties and keep your money compounding over time.

3. Get creative.

While many of us have a 9 to 5 job there are lots of things we do on the side that could potentially earn us a supplementary income. We’re not suggesting that you go out and get a second full time or part time job, but turning a hobby into a small business is easy enough with the internet and all the tools it provides. This way not only will you be spending time doing something you love but you’ll also be providing for your future.

4. Don’t wait to get started.

There are many ways to save for retirement; however the sooner you start the better off you’ll be in the long run. Even putting $20 aside a week can add up to quite a pretty stash of money when it comes time to retire. Thinking ahead is the key to retiring wealthy and living the rest of your days drinking margaritas on a beach. So, sit down with your finances, determine how much you’d like to save, figure out a game plan, and get started.

Jason D. Steele is personal finance writer and a consumer advocate.He specializes in helping people eliminate credit card debt and maximize rewards.

Photo by Ken Teegardin via Flickr

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