Financial Literacy 2007 - Retirement
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10 ways to boost retirement planning

8. Save raises and windfalls

It's so tempting to fantasize about the next big bonus or an upcoming raise. All that extra cash could buy crisp new clothes, a vacation or other treats. Or, depending on your financial situation, it could go a long way to keeping the kids in diapers and the utility bills paid on time.

Either way, financial pros agree that everyone should try to save as much of their raises as possible. If you're using windfalls to finance the good life, you're going to have to work hard to justify why that money isn't better spent on retirement.

"I think it's easy for most people to save significantly more than they realize and not have to make too many adjustments in their lifestyle," says Matthew Greenwald of Greenwald & Associates, a research firm specializing in retirement studies. "How much is that extra pair of pants or that meal? Are they worth it? It's a question of taking control of your whole life, not just immediate gratification."

On the other hand, if you really need a fatter paycheck to get by, try to compromise. Save a portion of your raise and make it a goal to gradually increase retirement savings over time. If you have earnings automatically deposited into a 401(k) or other savings as soon as you get the pay hike, you'll be less likely to feel like you're missing something.

9. Talk to a pro

Recently, the folks at Employee Benefits Research Institute polled working individuals and asked them a simple question. "What would be the most useful thing to help you save for retirement?"

No. It wasn't a fat salary or winning the jackpot. It was professional advice from professional advisers that ranked No. 1 for more than one out of four respondents, making it the top choice overall.

In truth, there are few of us who will likely have the time or expertise to single-handedly map out our retirement during the course of a career. When we're young, it's enough to save as much as possible. But as we near retirement, a planner can help with the kind of personalized financial planning that has a big impact on what winds up in that nest egg.

How do you find that trusted adviser? First, be forewarned that anyone can brand himself a money expert. Avoid a dud by looking for someone who's earned credentials that indicate he or she has demonstrated financial expertise in retirement-planning issues. For example, a Certified Financial Planner, or CFP, is someone who's earned credentials by passing exams for the Certified Financial Planner Board of Standards. You can search for one near you at

Fee-only planners charge for their time, not by commissions, so they're a great choice if you just want advice, not someone to manage your assets. Check with NAPFA at for one in your area.

If you opt for word-of-mouth references, that's fine. Just make sure you hire an adviser who is trained to deal with clients similar to you. After all, retirement is a personal matter and the advice you get should reflect that.

10. Fall off the wagon? Get back on

The one thing most of us can rely on is being inconsistent. Very few individuals have the discipline to stick to a lifetime of healthy habits, be it consistent exercise, a sugar-free diet or financial willpower. Add the pressures and temptation to spend money and it's more than likely that even the best-laid plans for retirement get pushed off course.

What to do? Get back in the game, of course. Resume saving. Keep spending in check, and take a look at your retirement goals.

If you've taken a long hiatus from saving, or major expenses have drained your accounts, you'll likely need to reconsider some of the plans you made for yourself.

The good news is, there are opportunities to catch up. Most retirement plans give individuals over 50 a second chance to save more than other individuals. Depending on where you stash your cash that could mean an extra $5,000 or $500 a year, before earnings. Those additional funds can make significant improvements to even the most anemic savings.

So never give up. If you stick to your plan and stay focused on that dream, you will get closer to your goal. And that's not a bad place to be.

Are you worried about having enough money to retire someday? Or, do you have a plan of action? Share your story

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