5 ways to reset your retirement savings and save more money in 2022

5 ways to reset your retirement savings and save more money in 2022

Overview office retirement plan contributions

Contribute to conventional or Roth accounts — or each

Increase automatic contributions to accounts

Whether you’re putting new money into a traditional or Roth 401(k), experts advise reviewing your automatic contributions. Try to increase them by 1% to 2%, or at least enough to get your company’s matching contribution, even if you can’t fully fund the account. 

Do your best to get the employer match.

Kamila Elliott

chair of the CFP Board of Directors

“For some people, $20,500 is a stretch,” Elliott said. “It’s a great goal to have but they can’t achieve it.”

If you can’t reach the maximum contribution limit, she said, “do your best to get the employer match — and then slowly work your way up.” 

Check out target date funds for simple rebalancing

Evaluate options for old 401(k) money 

And for the job changers, if you still have 401(k) money with a former employer, you can leave the funds there, but you may want to consider rolling it into a 401(k) with a new employer or into an individual retirement account. Just don’t cash it out or you’ll face a potentially significant tax hit and pay a penalty, depending on your age, Young warns.

Also, for new contributions to traditional or Roth IRAs, you possibly can put in as much as $6,000 this 12 months, similar as final 12 months. And, for those who’re 50 or older, the utmost contribution is $7,000. If you happen to did not make an IRA contribution in 2021, you’ve got till the tax submitting deadline in April to try this and have it depend for final 12 months.

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