Money Monday: Tips for saving for retirement

It is 8.13. Welcome back. Today on Money Monday, we are talking about saving for retirement. Fidelity Investments says it has a record number of clients with at least $1 million in their 401ks. The firm says its million-dollar accounts jumped by 19% recently to 769,000. That is a significant amount. But here's the question. How do you get there? Financial therapist Lindsay Bryan Podvin is joining us with some steps to help us get there. Good morning to you, it's good to see you Lindsay, how are you? Good to see you, Danielle. I'm great, thanks. All right, so a million dollars in your 401k, we do know that this is something that does not happen overnight, right? Right. As Michelle points out in her article you can become a 401k millionaire with things like discipline time and patience, and as a financial therapist I'd add two extra things to that list. I would add access, making sure you're taking advantage of 401k accounts and then also I would add in how you feel about money. When we're financially stressed, we can procrastinate and avoid taking action on things like contributing to our 401k, all right. so let's focus on discipline in here for a moment, what does that look like when it comes to investing? and specifically to investing in your 401k when it comes to investing in your 401k discipline means making sure that you are consistently putting away money every single month. And you can start out low by contributing 1% of your income, to your 401k. The gold standard of making sure you're contributing enough to take advantage of that employer match still stands here. But being consistent and really staying the course, that's more about the discipline. This isn't so much about cutting your lattes or never buying a new pair of shoes. It's making sure that every single month you're putting money into your retirement account. And I think that's an interesting point you make, because I think a lot of people may think, okay, so if I'm going to be disciplined, that means that I can't have this latte every single day. I need to make my coffee. That means I need to maybe not shop for this kind of food. I need to do this. Those are kind of asides to what you're talking about, which is just making sure from your paycheck, you are investing a certain amount every month. Yes. And I would also add that that latte advice, saving $6 here, saving $10 there, that really doesn't go very far. So I would say, yes, make your coffee at home, but then also give yourself permission to treat yourself to a latte once a week. So the bigger things to focus on when it comes to retirement are those big expenses. If you want to cut back so you can contribute more to retirement, look at things like housing, look at things like transportation and things like high interest debt payments that you can pull back on instead of focusing on those little teensy expenses here and there. That makes sense. And, you know, one of the other things to focus on is patience, right? Because as we said at the top, this is not something that happens overnight. How can you be patient with your account? Because this is something that grows over the course of not months, but years. Yes, multiple years, decades, in fact, to become a 401k millionaire. So when it comes to patience, I think patience and celebrating all those little milestones along the way. So if you're checking your account all the time, there's a very good chance you might get anxious and pull back from contributing. So we don't want to do that. But patience can also mean celebrating when you hit another thousand dollars in that 401k and maybe treat yourself and a friend to that latte. so you can continue to enjoy life along the way. I like that. So it is a balance. You've given us some really good information, Lindsay. Thank you. My pleasure. Take care, Danielle. You do the same.