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6 retirement maneuvers for 2010

By Jennie L. Phipps · Bankrate.com
Monday, December 6, 2010
Posted: 4 pm ET

The first decade of the 21st century is ending. Like it or not, you're not getting any younger.

Here are six retirement planning steps to take before 2011. No procrastinating!

1. Get the full 401(k) match from your employer. Before you get that last paycheck of the year, call HR and tell them to move enough savings into your account that your employer kicks in the maximum match. At many companies, that's 50 cents per $1 saved, up to 6 percent of pay. In other words, if you earn $50,000 and contribute 6 percent, or $3,000, the boss will kick in another $1,500. Using Bankrate's 401(k) calculator, for the sake of simplicity, let's say you save 6 percent per year from the time you're 30 until you turn 65. No raises, no layoffs and a modest 5 percent interest rate. With the employer match, you would have saved $433,915. Without the employer match, you'd only have $294,793 -- about $139,000 less. Nothing to sneeze at.

2. Up the amount you're saving by 1 percent. Unless you're remarkably more dedicated to retirement savings than most of us are, you could stand to put away a little more. Even in a tough year, you can afford to add a few more dollars to the retirement kitty. So hurry down to HR and make the switch, effective the first paycheck in January 2011.

3. Update your beneficiaries. When you set up a retirement savings plan, you were asked to designate who would get the money if you die. These designations override what you put in a will. Heaven forbid that all your hard-earned money will go to your ex-husband.

4. Review your estimated benefits from Social Security. Everybody gets a sheet with this information on it in the mail a few months before their birthday. If you threw yours away, you can get another copy from the Social Security website. You also might find it useful to read up on the fine points of the program. Choosing when to take benefits is a worthy retirement-strategy game, and you have to know the rules in order to win.

5. Check up on your past employers. Are you entitled to a small pensions from a previous employer? Did you leave behind a forgotten 401(k)? Making a call to the union, your former employer's HR department or checking out the search engine on the Pension Benefit Guarantee Fund could prove to be very profitable.

6. Spend at least an an hour playing with a retirement planning calculator. A retirement planning calculator will help you figure out how much money you need to save to retire comfortably. Otherwise, you're on the road to retirement without a map.

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