Choose Wisely Now to Benefit Later

May 11, 2021
Choose Wisely Now to Benefit Later

Paper or plastic? Stairs or the elevator? Chocolate or vanilla cookies? You make decisions every day—lots of them. Many have little or no lasting significance. But some of the choices you make now could have a significant impact when you retire.

Spending Choices

Take spending, for example. Buying things is fun, but splurging on too many things now, could limit your ability to splurge later—or even to afford everyday necessities. If you shortchange your savings, you may end up having to live on a lot less or even postponing your retirement.

You do not have to eliminate all discretionary spending, but you should think twice before buying things you don’t need. Weigh the pros and cons before making a big financial commitment. For example, if you normally buy a new car once your current car loan is paid off, try waiting a few years to replace your car instead. Then put the money that would have gone to car payments into your retirement account.

Lifestyle Choices

Making healthy lifestyle choices—such as eating well, exercising, and taking care of yourself—can pay off throughout your life. Moreover, the potential benefits are not just physical. Your choices may promote good financial health, too, by keeping your medical costs in check now and during your retirement.

Contribution Choices

The amount of savings you have in your retirement plan for when you retire will mostly depend on your decisions concerning how much to contribute to this plan. Many experts today recommend annual contributions of between 10% and 15% of pretax pay, yet it may be a good idea to meet with a financial professional to discuss your personal situation.

Savings Choices

The amount you are able to earn will influence how much you’re able to save. Ideally, the more you earn, the more you can save. Therefore, an opportunity to advance your career is also an opportunity to advance your chances of a financially secure retirement.

Sometimes, when emergencies such as natural disasters or the current pandemic occur, you may be eligible to withdraw money from your retirement plan account. As tempting as it may be to cash out, that would derail the progress you are making toward your goals. If possible, it would be better to consider choosing an option that lets you keep your savings growing tax deferred.

Of course, your situation is unique, so be sure to consult a professional before taking action.

For more information or guidance concerning different retirement strategies available to you, please send an email to our financial expert at

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The information provided is for educational purposes and for your independent consideration. The information and overviews found in this article are designed to help you understand some of the factors that you should generally consider when evaluating the appropriateness of any strategy in your retirement plan. Any description included is for informational, educational purposes and for your independent consideration only; it is not to be considered, or viewed, as advice or as a suggestion to take (or be inhibited from taking) any particular action. Banco Popular de Puerto Rico, its subsidiaries and / or affiliates are not engaged in rendering legal, accounting or tax advice services. If legal, accounting or tax advice services are required, you should seek the services of a competent professional.