Save Now: Turbo Charge Your 401(K) to Get Maximum Value

Business.com / Finances / Last Modified: February 22, 2017

Retirement may seem like a long way off, but saving today will help lighten your burden down the road. Tips for turbocharging inside!

There are many people nearing the age of retirement who feel that they are not getting the maximum value for their 401K savings.

There are many ways of turbocharging your 401k, which ensures that you get the maximum value from this investment plan.

Some tips that will help you attain the best are as follows.

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Take Different Asset Plans

There are many asset classes that you can invest in through your 401(k), which will help maximize the benefits that you get from your 401k. You can invest through a self directed 401(k) that will enable you to invest in real estate, commodities, gold, and other avenues. Compared to the old 401ks, these self-directed plans give you the flexibility to invest anywhere you want to. 

However, it is not always easy to understand the ups and downs of the financial market. Therefore, you should take the advice of a qualified financial advisor to gain profits.

Invest in Other Plans

Apart from taking different self directed 401(k)s, you can also look to invest in different types of IRAs. This will not only diversify your investment portfolio, but will also help you gain some extra income. You can easily reinvest the profits in your existing 401(k)s. This will increase your contribution, thereby increasing your savings by the end of the year.

401k Should Top Your List

When making your monthly ledger of income and expenditure, add your 401k payments in the first line of expenses. This way you will never forget to pay them or won’t run out of cash while taking care of other expenses. As mentioned earlier, you should always relay all your extra income towards your 401(k) investment so that you can grab a valuable chunk from your retirement savings.

Clear Out Existing Debts

One of the biggest factors that hamper the value of the 401ks is your existing debt. There is a high chunk of money going from your monthly check to these payments, which means it is eating up your savings balance. 

Surveying your credit card bills and loan payments should be your first option when you start planning for your retirement. Clear out as much as possible so that you have enough in your bank to increase your 401(k) contributions. Apart from this, paying off all your high interest debts would also mean a peaceful and debt free life.

Check the Match of Your 401k

Many companies offer a match for the contributions made by their employees in their 401k plans. As per the federal law, the company should be giving you anything between 50 cents on a dollar to 6 percent of your monthly salary. If you do not have any idea about the match done on your 401k, find out from your HR department. Check the details properly and ask if there is any way you can maximize the match.

Shop Around

It is always better to shop and research around before taking a retirement plan. The best way to do this is by choosing 5-6 investments options that you think are the best in the market. Checking the fees, interest rates, and periodic contributions required will also help you decide about the plan that will help you turbo charge your 401ks.

Related Article: How to Avoid Financial and Psychological Stress in Retirement Planning

Take Financial Advice

When it comes to your retirement planning, all your decisions should be based on rational and logical thinking. Therefore, it is vital to take advice from financial experts. These advisors have the acumen and expertise to provide financial advice that will help you maximize your retirement 401(k)s. They will also ensure that you have the proper asset allocation, which will add high value to your 401k portfolio.

Turbo charging your 401(k) investment is the best way of gaining the maximum benefits from your retirement investments. The above tips will help you gain the much needed profits from all your retirement investments.

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