How to grow your savings for retirement

Saving for retirement, woman with hands over piggy bank

How is your retirement saving plan progressing? Will you be able to put enough away to live in comfort in your later years, or are the demands of today making tomorrow look shaky?

Saving for retirement, woman with hands over piggy bank Saving enough money to carry you through your retirement years is a major undertaking. After all, you’ve invested in your health, and life expectancies are high these days. How many years could your savings cover without some additional income?

If your answer is “not many”, you’re not alone. It can feel like a challenge making enough to cover costs in the now, especially for women starting or running their own business. Entrepreneurs are often working so hard to grow their business and help it be successful that its needs eclipse their own. Plus, those lean startup years tend not to be conducive to great benefits and sizeable 401k contributions.

Savings accounts will give you a little interest on what you are able to put away over the years but they tend not to grow very quickly or significantly. Can you afford to put away a third to half of your income against your needs later in life? But if you can’t save significant funds and savings accounts don’t increase your money by much, what should you do?

There are many different arguments and approaches about how to prepare for retirement. Some advise reducing your lifestyle expectations dramatically and spending much less than you make in order to save more, faster. But for entrepreneurs, there may not be a lot of extra margin to trim back on in the first place. You could shop around for a higher rate of interest on your savings account, but guaranteed interest rate accounts tend to top out in the very early single digits.

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Most women who want to grow their savings for retirement look to investments to maximize their returns. There are a variety of different approaches to investing and types of investments, and the results can be variable.

Generally, the greater the risk, the higher the reward. If you’re willing to take more risks with your savings, you may be able to grow your money, faster. However, there are no guarantees, and you need to know when to take a risk and when to avoid it in order to be successful. You could try this type of investing if you want to take a portion of your savings (in order not to risk it all) and are willing to either put in the time to learn what makes a good investment and to track the markets, or you could work with an expert to ensure you make the best investment moves.

Having reliable, accurate, and timely sources of information is crucial. You want access to relevant news, share tips and expert advice as well as a broader understanding of the type of investment, market, and larger economic forces at work. You might invest in currency markets, or shares in a specific company, or choose a managed fund with a mix of elements.

Investing over the long-term is another strategy for success, so one thing you can do is start investing sooner than later, even if you only want to stick to low-risk investments, because you should still see much better returns over time than you would from a savings account.

Investing is one of the most effective things you can do to grow your savings for your retirement. Gauge your risk, be realistic about what you can commit, and start sooner than later for best results.