How Moms Can Save for Retirement

Whether you’re a working mom or stay-at-home with the kids, saving for retirement can often be put on the back burner, but when you are a stay at home Mom, it is even harder to save. You don’t have employer contributions or benefits like FSAs. It can be a bigger challenge to find ways to save between keeping to the household budget and wanting to build college funds for the kids. While the likelihood of divorce may be slim, statistics are stacked against us so it is best to have your own little nest egg in addition to the one your partner may have or be providing. Here are some retirement saving tips for moms:

retirement savings tips

Retirement Saving Tips for Moms

Save now.
Start saving early so your money has time to grow. If you’re worried about sticking to your budget, start small. Even $20 a week can go a long way over time, and when your budget allows, contribute more. Give up a couple of Starbucks drive-thru visits or push back a haircut or color by a couple extra weeks. It is easy to find it with a little, mini-mani, sacrifice.

Start to Plan.
I know, between breastfeeding marathons, kids’s school vacation weeks, and school homework, it is hard to plan for us, but it is important to understand expenses for the type of lifestyle you want. While the kids are doing their math homework, do your own homework to figure out what are your retirement goals (travel? covering expenses? health care costs?) and start planning now. There are helpful interactive calculators online that can help you determine how much you will need in retirement. And visit a financial planner (they often consult for free) to figure out your options.

Saving for College before Retirement.
I know, we always put the kids’ needs before out own and that includes figuring out how to pay for private school or college. But consider this: you and the kids will have access to loans and scholarships to help pay for college, but there is little help to pay for monthly expenses after retirement. Consider having separate savings for college and retirement, and contribute to both. But speak to a financial planner first. Sometimes your savings can hurt your loan options so find ways to protect your investments. All in all, even if you’re contributing less to each than you would like, the longer the money is in the account, the more the interest will accumulate.

Pay Things Off Now to Pay for Things Later.
If you pay off your graduation student loan now, or your mortgage, then the money you were putting to those payments are now free for savings opportunities. (Plus, you are saving on interest too!) Also consider the fact that those recurring payments will be harder to make when you’re on a fixed income, so it is good all around to pay them all off now.

Relying on Social Security (yeah, right).
I am convinced Social Security benefits will not be around by the time I retire so unlike our lucky parents and grandparents, we are probably going to be on our own. But presuming my pessimism is unrealized, the meager $1000 average Social Security payment, it is not going to go very far. Remember having to eat Ramen Noodles after graduating for college because your new job paid didily-squat to cover the rent, car and insurance, and food. Well, I lived it and not interested in reliving it when I am 70. You can visit www.socialsecurity.gov to find out what benefits you should plan for.

Plan For When Your or Your Partner Kicks the Bucket.
If you have joint accounts, it may be hard to access those funds in the event of a family death, and who knows if your cell phone company is going to be sympathic. (They aren’t when your toddler drops your phone in the toilet so probably not). Having joint retirement accounts will protect you, your family, and your finances in the event of an unexpected death but also visit an estate planner to figure out what you should do now to protect your savings, reduce taxes and more upon the death of you or your spouse. (Those government death taxes are deadly….no pun intended. Makes you wonder why spouses often pass so soon after their husband or wife. Probably because they got the government bill…)

So put it on your 2014 things to do list and start making plans for you and your family’s future. Just like we can’t believe our kids are growing up so fast, retirement will be here as soon as we know it too.

*Sources: US News & World Report, Social Security Administration, USA Today, ZCommunications 
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