3 Reasons You're Falling Behind on Retirement Savings -- and What to Do About Them

If you're not feeling confident in your retirement savings, you're probably in good company. But have you stopped to think about why you aren't making progress funding your IRA or 401(k)?

It may be due to a string of unfortunate circumstances -- job loss, medical issues, or even a steady stream of home and car repairs. But it could also be due to these three habits.

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1. You're taking on too much debt

Debt has a sneaky way of piling up. You might charge a vacation or a few sets of concert tickets on a credit card and tell yourself you'll pay it off as soon as you can. But then your car might break down, or you might need to shell out money for another unplanned bill. Suddenly, your debt starts climbing. And the longer you carry it, the more interest you pay.

Some debt may be unavoidable. If you need a car to function and can't buy one outright, you may have to sign an auto loan you pay interest on.

But if you're struggling to make progress with your retirement savings, take a look at your spending habits and debt, and see if changes are in order. You may need to cut back on certain expenses to get out of debt and/or avoid future debt. But the less money you lose to interest, the more you can contribute toward your nest egg.

2. You're falling victim to lifestyle creep

When you work hard and get rewarded with salary boosts, it's natural to want to enjoy your success. But if you keep spending your higher paychecks instead of saving a larger portion, you may not make progress on retirement savings like you're hoping to.

The next time you get a raise, rather than allocate it to a new expense or purchase, send it into your 401(k) plan. That way, you're less likely to miss it.

3. You're not investing aggressively enough

The stock market can be a scary place to put your money. But if you want to grow your retirement savings, it's important to take on some risk -- especially if you're many years away from ending your career.

If you invest too conservatively, your savings might stall, even if you're funding an IRA or 401(k) on a pretty consistent basis. If the idea of choosing stocks individually for your portfolio is too daunting, look at buying shares of an S&P 500 index fund or ETF. That gives you exposure to many large, established businesses with a single investment.

It's not a good feeling to look at your IRA or 401(k) and see a number you aren't happy with. Rather than resign yourself to retiring with less money than you'd like, think about why you're behind on savings -- and take steps to make positive changes that allow you to make better progress.

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