How to Build a Better Retirement

Most of us are looking forward to retirement, but yours may not be as good as you hoped if you don’t plan for it and make some smart moves — like these:

• Pay off debt. It’s OK to maintain a low-interest-rate mortgage, but work hard to pay off any high-interest-rate debt, such as that from credit cards.

• Have a plan. Run the numbers to see how much money you’ll need for retirement, how close you are to your goal and how you might get there. Online calculators such as those at calculator.net and finra.org/

retirement calculator can help, and a financial planner can be well worth hiring, too. (You’ll find fee-only ones at napfa.org.)

• Save aggressively. Don’t just save a little in your 401(k) and hope for the best. The more you save, and the earlier you do so, the more you’ll likely end up with in retirement. Long-term money stands a good chance of growing well in the stock market, and low- fee S&P 500 index funds can have you in stocks quickly and easily. Contribute generously to IRAs and/ or 401(k)s.

• Spend less. There are lots of relatively painless ways to cut back, such as by switching from cable TV to one or more streaming services and by shopping around for lower insurance rates on your various policies. Eat out a little less often and shop only when you need things, not just for fun. If you can spend $200 less per month, that’s $2,400 per year, which would grow to more than $118,000 over 20 years at an average annual growth rate of 8 percent.

• Consider retiring a few years later than planned, to save more money and delay starting to tap your nest egg. You might enjoy company-sponsored health insurance a bit longer, too. Or aim to retire early, if you can. A good plan and discipline can have many retiring in their early 60s or sooner.

Learn much more at fool.com/ retirement/index.aspx and money.cnn.com/retirement, and try our “Rule Your Retirement” service at fool.com/services. It offers solid, concise advice, along with stock and fund recommendations.