Introduction: You’ve Started—Now Let’s Build on It
If you’ve taken the first steps to start saving for retirement—congrats! That’s a major win.
But once the initial setup is complete (you’ve chosen an account, started contributing, and defined your goals), many people get stuck wondering: What do I do next? This phase is just as critical. It’s where small, smart decisions add up and really start to build momentum.
In this article, we’ll walk you through what to focus on after getting started with retirement planning—from optimizing your accounts to planning for income and taxes in retirement. With these next steps, you can stay on track, avoid common missteps, and move forward with confidence.
Related: Let Us Help You Retire Well: Smart Strategies for Long-Term Financial Security –
1. Increase Your Contributions Over Time
Now that you’ve started saving, your goal should be to gradually boost those contributions. Ideally, you want to work up to saving 15%–20% of your annual income.
Even if that sounds like a lot, don’t worry—start small and increase slowly. Try this:
- Add 1% more every year (or every raise).
- Allocate windfalls (tax refunds, bonuses) toward retirement.
- Use a retirement savings calculator to set benchmarks for each decade.
The earlier and more often you increase your savings rate, the more compound interest works in your favor.
2. Take Full Advantage of Employer Benefits
If your job offers a 401(k) with a match, make sure you’re contributing enough to get the full match. This is essentially “free money,” and it can accelerate your retirement savings in a big way.
Also, don’t overlook:
- Roth 401(k) options (if offered)—tax-free growth can be a powerful tool.
- Profit-sharing or employee stock plans—but make sure you’re not too concentrated in company stock.
- Health Savings Accounts (HSAs)—if available, these triple-tax-advantaged accounts can also help cover medical costs in retirement.
If you’re self-employed, explore Solo 401(k)s or SEP IRAs, both of which offer high contribution limits and flexibility.
3. Review and Rebalance Your Investments
When you first set up your retirement account, you likely chose an asset allocation—how much of your money goes into stocks, bonds, and other investments.
But over time, market performance can throw that off balance. For example, if stocks grow faster than bonds, your portfolio might become too risky for your comfort or time horizon.
What to do:
- Review your asset allocation annually.
- Rebalance to maintain your target mix.
- Consider low-cost index funds or target-date funds that automatically adjust as you age.
This one small habit—reviewing and rebalancing—can help protect your savings from unnecessary risk while still allowing them to grow.
4. Understand Your Retirement Number
As your savings grow, it’s time to get more precise about your goals.
Initially, you might have set a rough savings target. But now, you want to:
- Estimate how much income you’ll need each year in retirement.
- Factor in inflation, rising healthcare costs, and potential lifestyle changes.
- Subtract expected income sources like Social Security or pensions.
Use tools like:
- The 25x Rule (multiply your annual income goal by 25)
- Retirement income calculators
- Monte Carlo simulations (offered by many financial planning tools)
Having a clearer target will help you stay motivated and make smarter saving decisions.
5. Plan for Taxes in Retirement
One of the biggest surprises for new retirees is how much taxes can eat into your income.
The good news? If you plan ahead, you can minimize your tax burden and maximize your withdrawals.
Here’s how:
- Diversify your tax buckets: Include traditional (pre-tax), Roth (post-tax), and taxable brokerage accounts.
- Understand Required Minimum Distributions (RMDs): These start at age 73 and apply to traditional retirement accounts.
- Consider Roth conversions: You may benefit from converting some traditional savings to Roth IRAs while you’re in a lower tax bracket.
Taxes in retirement are manageable—but only if you prepare for them well before you stop working.
6. Strengthen Your Emergency and Insurance Safety Nets
Retirement plans can be derailed by one unexpected event—job loss, medical emergency, or an accident. To stay on track, make sure you have:
- An emergency fund with at least 3–6 months of expenses
- Disability insurance (especially if you’re still working)
- Life insurance, if you have dependents or shared debt
- Umbrella liability insurance to protect against lawsuits
Additionally, look ahead to long-term care planning. Options include:
- Long-term care insurance
- Hybrid life insurance policies with care riders
- Setting aside a portion of your retirement savings specifically for health costs
7. Create a Long-Term Investment Strategy
Now that your accounts are set up and you’re contributing regularly, it’s time to think long term.
Your investment strategy should:
- Match your risk tolerance (how much volatility you can handle)
- Be appropriate for your time horizon (years until retirement)
- Reflect your income needs in retirement
Typically:
- Younger investors lean more heavily into stocks for growth.
- Those nearing retirement may shift toward more bonds and income-producing assets.
- A mix of growth and income (like dividend stocks, REITs, and annuities) can provide balance.
If you’re unsure, target-date funds or a robo-advisor can do the work for you.
8. Revisit Your Retirement Timeline
When you first started planning, you might’ve chosen an ideal retirement age. But now’s a good time to ask:
- Is that timeline still realistic?
- Would I like to retire earlier or later?
- Should I consider phased retirement (working part-time first)?
Adjusting your retirement age can have a big impact on how much you need to save—and how much risk you can afford to take. If you’re behind, even delaying retirement by two or three years can significantly improve your financial outcome.
9. Keep an Eye on Inflation and Lifestyle Creep
The longer you plan to be retired, the more you’ll feel the impact of inflation.
For example:
- A $60,000 annual budget today could need over $100,000 in 25–30 years.
- Healthcare, housing, and food tend to outpace general inflation.
To combat this:
- Invest in growth-oriented assets (especially in early years).
- Revisit and revise your retirement income strategy every few years.
- Avoid lifestyle creep (increasing your spending as your income rises).
Smart inflation planning now = less stress later.
10. Get Your Legal and Estate Documents in Order
As your savings grow, so does the importance of protecting them. Estate planning is often overlooked, but it’s an essential part of retirement readiness.
Be sure to create or update:
- A will
- Durable power of attorney
- Healthcare proxy
- Beneficiaries on all retirement accounts
- A living trust, if applicable
Not only does this ensure your wishes are honored, but it also protects your loved ones from confusion or legal complications later.
Final Thoughts: Keep Moving Forward
You’ve taken the first steps—and that’s huge. Now, by continuing to take small, deliberate actions, you can build a retirement that isn’t just comfortable, but confident and fulfilling.
The key is consistency:
- Review your plan annually
- Increase savings when possible
- Stay educated and adjust as life changes
Remember: Retirement planning isn’t about perfection—it’s about direction. And with each step, you’re getting closer to the future you deserve.
Disclaimer: The content on this post is for informational and educational purposes only and should not be considered professional financial advice. Your path to a debt-free and financially secure future awaits!