Saving to Retire

Here are tips on how to make saving for retirement easier:

1. Pay off credit cards first. Paying down debt with high interest rates such as credit cards is essential.

2. Build an emergency fund. Put aside six months' worth of expenses in a liquid, accessible fund that can be tapped for unexpected needs such as car repairs or medical bills.

3. Set up automatic withdrawals. Contact your bank to have a predetermined amount saved from each paycheck or taken from your checking account every month.

4. Start small and move up. Even with an entry-level salary, most people won't miss 2 percent or 3 percent of their paychecks. Start with that sum just to get going. Try to bump up your savings rate to 10 percent of pay as soon as possible. The longer your contribution remains in the single digits, the more you will have to step it up in later years to make up for lost time.

5. Don't turn down free money. If your employer has a 401(k) matching program, be sure to contribute enough to your account to qualify for the company match.

6. Save your raises. Every time you get a raise, increase your savings rate. You don't have to save all of it, but the more the better.

7. Live within your means. Don't buy something if you don't need it. Monitor your daily spending and take pride in being frugal.

8. Stay disciplined. Set a long-term saving plan and do your best to stick with it.

SOURCE: Associated Press