It's hard to save money each and every month. If you've got limited funds and competing savings and debt-reduction goals, finding money to put toward retirement might fall to the bottom of the list, with more current needs taking precedence.
But accumulating sufficient financial resources for a secure retirement requires diligent saving throughout your working years. Here are four strategies that you can utilize to help you find ways to save every year.
Always pay yourself first
Treat your savings as a non-discretionary budget item that must be paid every month. Try reversing the typical bill-paying method that directs money to your living costs, debt, and entertainment, leaving whatever is left over for your savings. Instead, start by paying your savings account each month, then pay your bills. This way, once you know you have money saved, you can spend the rest any way you like.
Never miss out on free money
When saving for retirement, the first place you should consider is a workplace retirement plan, if you have access to one. While it's important for you to review investment choices and fees within the plan, if your company offers a matching contribution, it's essential that you take advantage of this free money.
Depending on the size of the match, this could be a 50% to 100% guaranteed return on your money, which you just won't find elsewhere. This can also help you reach your savings goal by closing the gap between the amount of money you're actually putting away every month and the amount you should be putting away to hit your financial targets.
Save raises and bonuses
When you receive a bonus or raise, it's a great time to jump-start your savings. Since this is not money that you're currently depending on to pay your bills, redirect it right into savings and you'll never miss it.
If you get a pay raise each year, even if it's just a 2%-3% bump, increase your savings rate by at least 1%. This way, you increase your savings limit and still get a bump in your take-home pay. What you don't want to do is increase your monthly spending to eat up all of your new income.
Meanwhile, if you aren't yet saving the ideal amount of your annual salary for retirement, bonus money can help you meet your savings goal for the year. If your employer doesn't give you the option of putting your bonus into your workplace retirement account, consider funding an IRA.
Don't miss IRA contribution years
Each year, you're allowed to contribute a set amount of money into an IRA. If you fail to contribute for a year, you lose out on that savings opportunity forever.
The good news is that you can spread your contributions over about a 15-month period of time -- from January through March of the following year. Technically, you have until tax day in April to contribute for the previous year.
For 2017, the maximum allowable IRA contribution is $5,500 if you're under age 50. And for anyone age 50 or above, you can save $6,500 annually. Even if you're unable to reach the maximum amount allowed, try making a contribution every year.
Amassing a nest egg large enough to cover all your retirement needs requires consistent and continuous savings every year, up until you stop working. Even if you're a long way from achieving your savings goal, make sure a portion of your income goes toward your nest egg every single year. Small changes can add up over time, and it's never too late to start improving your finances.