If you want to put yourself in a position to enjoy retirement without constant financial worries, it's a smart idea to save for it consistently throughout your career. And if you don't have access to a 401(k) plan from your employer for retirement savings purposes, you can always fall back on an IRA, instead.
In fact, you might have an IRA already -- ideally, one with a nice balance. But whether you have an IRA at present or not, if you intend to contribute to one in 2024, here are three goals you may want to achieve.
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1. Max out your contributions
Maxing out a 401(k) plan isn't easy. Next year, 401(k) limits are rising to $23,000 for workers under age 50 and $30,500 for those 50 and over.
Maxing out an IRA, on the other hand, may be a lot more doable, even on more of an average wage. In 2024, IRAs will max out at $7,000 for savers under age 50 and $8,000 for those 50 and over.
Plus, if you're saving for retirement in a traditional IRA, every dollar you contribute up to the aforementioned limits is a dollar of income that's not taxable by the IRS. And if you're saving in a Roth IRA, the more money you contribute, the more opportunity you have to enjoy tax-free gains.
2. Broaden your investment mix
One nice thing about IRAs is that they generally allow you to invest in individual stocks. With a 401(k), you're usually limited to a bunch of different funds that don't give you as much direct control over your portfolio.
But one thing you'll want to do is branch out in your IRA. That means making sure you're invested in stocks across a range of market sectors.
Another good option? Load up on broad market index funds. An S&P 500 index fund gives you great exposure to the entire stock market, as does a total stock market fund, while eliminating a lot of the legwork that should go into researching individual businesses.
3. Check up on your investments at a good cadence
One mistake some IRA savers make is checking their portfolios very frequently and reacting to on-screen losses. In 2024, pledge to check your IRA roughly once a quarter. More than that is probably overkill.
Remember, your IRA investments are, by nature, long-term ones. So there's really no need to stress yourself out over their week-to-week performance. A quarterly checkup should suffice by helping you make sure your portfolio is well-balanced. That way, you won't be constantly tempted to dump investments that are down temporarily.
With the new year right around the corner, now's a good time to commit to different financial moves that could set you up for success. So pledge to hit these IRA goals in 2024. If you do, you might really set your future self up with a lot of retirement wealth.
