Watching Your Wallet: Mistakes to avoid with retirement contributions
FRESNO, Calif. (KFSN) -- Whether you're navigating the rising cost of living or juggling debt, contributing to a workplace retirement plan may not be prioritized.
Financial Coach and host of Maxxed Out on OWN, Leah Collins, says even small contributions can add up over time.
One of the biggest mistakes when entering the workforce -- not contributing to your retirement.
"The thing that you have in your 20s and your 30s on your side is time, and that time really comes into play with compound interest, right," she said. "The longer you have to save and invest, the better your returns will be."
Collins says take advantage of company match programs if offered, or if you're in a position to do so, max out your retirement account.
"Some people aren't built that way, and I understand that," she said. "You can do small things. If you get a raise, say you get a raise that's 3%, increase your retirement contributions and your savings by 1% to 2%."
Many retirement plans let contributions increase automatically every year.
Worried you don't make enough to contribute and pay your bills?
"Temporarily, that's okay, but you need to create a plan to increase your income or decrease your debt," Collins said.
Retirement planning mistakes to avoid in your 40's include underestimating longevity.
Collins says she also sees clients supporting kids and parents before protecting their own nest egg.
Financial experts also say to consider lifestyle inflation before taking loans or early withdrawals from your retirement accounts.
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