Prioritizing Overcoming distraction

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69 percent of workers say they plan to work for pay after they retire. Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc. 2013 Retirement Confidence Survey

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Prioritizing

Overcoming distraction

We all know the importance of saving for retirement while we're young. However, as life speeds up, new needs and wants are revealed that can make it even more challenging to achieve retirement readiness. With competing demands on your money, it's easy to get sidetracked by shorter-term goals, like buying or renovating a house or funding a child's education. Yet one of the best things you can do for your future is to make sure you are saving enough for retirement.

Here are five steps you can take now to keep you on track:

1. Sharpen your vision.

Some people dream of buying a boat and sailing the seas when they retire; others see themselves staying closer to home. Make a list of the activities you'd enjoy and the places you'd like to visit during retirement. What do you see yourself doing daily? Monthly? Yearly? Then, consider how those activities might shift in retirement. Focusing on the specifics of your retirement can reveal a clearer picture of where you're headed; it can also help you understand what expenses may be involved.

2. Think dollars and cents.

According to the Employee Benefit Research Institute's 2013 Retirement Confidence Survey, more than half of Americans haven't calculated how much money they need to save for a comfortable retirement. It's great to have dreams and goals for the future, but you also need to have the financial means to fulfill them. Rather than living on hope, do some research to determine what your dreams will cost, then begin to create a budget. The Retirement Budget Estimate is an easy-to-use tool at that can help you get started.

3. Pinpoint your progress.

How far along are you on the road to retirement readiness? Take a moment to tally all your sources of retirement savings, including past employer plans and Social Security (for a quick estimate of your future benefits, try the Social Security calculator at ).

Not sure you're saving enough? The Retirement Savings planner at can help you determine if you're on track to meet your projected retirement expenses. If you're not, now is the time to adjust your plan.

4. Set priorities.

Sometimes it can be hard to think about the future, especially when you have other financial goals that you're working on. If you're worried about college expenses for your kids, for example, consider this. Your kids have lots of options for funding college, including scholarships and low-cost student loans. Retirement doesn't work that way. If you can't cover your living expenses in retirement, you may wind up having to dramatically scale back your lifestyle in retirement. Whatever you do, avoid loans (if available) and other withdrawals from your retirement plan. Taking cash out of your retirement plan will not only set back your savings, it may also subject you to taxes and early withdrawal penalties.

5. Get on it.

Increase your regular contributions annually until you're saving 15 percent of your pay or more. When you have your money automatically diverted to your retirement plan account, you won't be tempted to spend it first. To understand the impact on your take-home pay, try the Salary Deferral Take-Home Pay calculator at .

Remember, retirement planning is an ongoing process -- one that takes time, patience and strategy.

Educated

Wherever you are.Wherever you are going.

Tips for setting goals

Goal setting is a crucial step in achieving the lifestyle you want in retirement. But for goals to become reality, you need to do more than scribble some ideas on a piece of paper. Goals need to be complete and focused. The following six questions will help you get started:

1. What are your goals for retirement? To simplify the process, group them into five main categories: Family and Home; Financial; Spiritual, Health and Well-being; Social; Educational and Cultural. Setting goals in each area and writing them down will help ensure that you give attention to each of these key parts of a healthy and balanced lifestyle in retirement.

2. Are they specific? To be successful, goals need to be clear and measurable. An example of a nonspecific goal is: Spending more time with my children and grandkids. An example of a specific goal? Visiting my children at least four times a year.

3. Do you have a timeframe? Timelines can help strengthen your commitment for achieving your goals. For example, it's a wonderful goal to want to lose 25 pounds, if you need to. However, your timeframe will dictate whether or not that goal is doable.

4. Are your goals realistic? To make this assessment, your goals need to be quantifiable. For example, it's not enough to say you want to retire someplace warm; you need to understand what it will cost for that to happen. Write out your goal in complete detail and be as specific as possible.

5. Is your spouse/partner/friend on board? If your retirement goals involve others, are they in agreement with your goal? You may dream of spending retirement golfing while your partner sees her or himself traveling instead.

6. Have you prioritized your goals? Once you've completed your list, review and prioritize them so that you pay attention to the goals that are most important first. Then, periodically revisit your list to add new needs and wants and to make sure you stay on track.

Wherever you are.Wherever you are going.

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