Mistake no. 1: Not contributing enough
There’s a 2019 survey that was conducted on 1,000 Americans with access to company-sponsored defined contribution plans found that the average boomer brings in an 8.5% contribution rate, which is pretty high, especially compared to younger generations.
This shouldn’t come as a surprise, because the older you are, the more income you must redirect to your retirement savings. Unfortunately, for some boomers, even the high contribution rate is still not enough to retire comfortably.
If it’s possible, boomers might want to max out their 401(k) contributions and take full advantage of catch-up contributions. This year, the 401(k) annual contribution limit reached $22,500, but given that all boomers are over 50 years old, they are able to make additional catch-up contributions of as much as $7,500 a year.
Truth be told, there’s really no hard-and-fast rule that can tell you exactly how much you should contribute, but you might want to look at what kind of lifestyle you want to have, where the next place is that you want to live, and how soon you can retire. All these things matter a great deal.
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