734.641.8400 July 2019
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2019 PSCU
Board of Directors
Frederick W. Morgan

Jeffery King
Vice Chairperson

Dean J. Trudeau

Edward A. Carey, Jr.
Charles Lowler
 Dale Reaume
Nora Sharpley
Credit Committee
Veronica Massey
Huey Ferguson
Juanita Henry
Planning for Retirement in Your 30s
Tips for securing your financial future

Whether you’re playing catch-up or fine-tuning established investments, your 30s is a crucial decade for strengthening your financial future. Consider these tips to help make your road to retirement a bit smoother.

Know your investment options

Whether you’ve already been saving for retirement or you want to get started, it’s important to be aware of your retirement investment options. According to Arielle O’Shea of NerdWallet, a work 401(k) account is a great place to start. You can contribute up to $18,000 a year toward retirement on a pre-tax basis. Many employers offer matching contributions up to a certain point — this is free money, so if possible, try to take full advantage of it. If you don’t have access to a 401(k), or if you’ve maxed yours out and want to save even more, consider an individual retirement account, or IRA. For example, with a Roth IRA, you can contribute up to $6,000 per year.

Make savings automatic

No matter the account you opt for, Stacy Rapacon of Kiplinger recommends funneling at least 15 percent of your income into retirement savings. Per U.S. News & World Report contributor Abby Hayes, automating your savings is an easy way to put more toward retirement. If you have a 401(k), your savings are already automatic. You can also set up regular direct deposits into an IRA. Or, download an app like Qapital or Digit to automatically save small amounts, then deposit that money in a retirement account.

Accept risk — but embrace diversification

In your 30s, you’re still several decades away from retirement. Writing for Bankrate, Leslie Haggin Geary points out that this distance allows you to invest your savings more aggressively. Instead of anxiously watching as markets go up and down, you can think for the long term and allocate the vast majority of your investments toward stocks. At the same time, it’s wise to maintain diverse investments. Rapacon notes that index mutual funds are an especially effective way to invest in a broad, stable range of stocks while still leaving plenty of room for growth.

Get debt under control

If you’re in your 30s and owe a great deal of student debt or credit card debt, you’re not alone. However, it’s important to have an aggressive plan for paying off your debts so you can put more of your money to work for your retirement. Should you wait to invest until you pay off debt? Not necessarily, according to Hayes. If the rate of return for your investments is higher than your debt interest rate, you may want to prioritize retirement savings.

Stay informed and engaged

You can “set and forget” certain aspects of your retirement savings, but make sure you remain informed about what your money is doing. Log onto your online accounts regularly to make sure your investments are properly allocated. Research the funds you’ve invested in to make sure that fees aren’t eating up your returns. Even more importantly, make sure that you set specific goals for your retirement and review your progress regularly. You’ll also want to consider meeting with a financial adviser to assess these goals and maximize the effectiveness of your investment strategies.

As a 30-something adult, you won’t be retiring anytime soon — but it’s still important to prioritize planning for that stage of life. Informing yourself about investment options, maximizing your savings and setting balanced financial goals are great ways to build wealth and achieve greater financial security for your retirement years.

Published by Public Service Credit Union
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Disclaimer - All content contained in this newsletter is for informational purposes only and should not be relied upon to make any financial, accounting, tax, legal or other related decisions. Each person must consider his or her objectives, risk tolerances and level of comfort when making financial decisions and should consult a competent professional advisor prior to making any such decisions. Any opinions expressed through the content in this newsletter are the opinions of the particular author only.  

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