Retirement Planning: Simple Steps to Help You Gain Control

RetirementwhyRetirement security is essential, so it’s important to create a strategy to achieve your desired goals. Here are a few tips to creating a solid foundation for years to come:

1. Start Early and Often
Even if you can manage to save only a small portion of each paycheck for retirement, start now. Plan to increase the percentage of pay you’re saving by at least 1% a year. If you increase your savings contributions gradually, you may hardly notice an impact on your day-to-day finances. The sooner you start and the more aggressively you save, the sooner you can start taking advantage of compounding on your investment earnings.

2. Focus on Your Unique Circumstances
Common financial rules of thumb can be misleading. You’ve probably heard several, like: “100 minus your age is the percentage of stock you should have in your portfolio.” Or: “You should not sell an investment for less than its purchase price.” These are overly simplistic and broad views of retirement investing. It’s best to make informed decisions based on your personal situation. A financial planner can help you think through the possibilities.

3. Keep an Eye on Your Investment Mix
Your investment mix, or asset allocation*, is key to achieving your retirement goals. We’re talking about the mix of stocks, fixed income, and cash in your investment portfolio. Because each asset class has its own historical risk-and-return characteristics, you can use asset allocation to tailor your portfolio to your personal goals, time horizon, return objectives, and risk tolerance. Once you’ve established your asset allocation, review your portfolio at least once a year, or whenever your life circumstances change significantly. You want to make sure your asset allocation continues to reflect your intentions.

4. Don’t Try to Time the Market
You may find yourself tempted to “time the market,” which involves moving money in and out of investments in an effort to catch only performance highs and avoid the lows. But even investment pros are rarely successful at market timing. And remember, you won’t see losses on your account statements unless you actually sell assets at a loss. Steer clear of market timing.

As an actively-contributing member of the Annuity Plan, your EY financial planner can help you manage your money today, save for tomorrow and build a financial wellness plan for you and your family. Make the most of your benefits and contact EY today at 1.877.927.1047 or log in at

*Asset allocation: The way your money is divided among various asset classes (investment categories) — equities (stocks and stock funds), fixed income (including bonds and bond funds), and cash. Each asset class has its own historical risk and return. By investing with asset allocation in mind, you increase the chances of achieving your personal goals and objectives for risk and return.

This article is used with permission of Ernst & Young LLP.