For anyone concerned with their finances, it’s crucial to maximize their retirement savings. The personal IRA is a powerful tool that can be leveraged to boost your wealth and reduce current tax burdens. If you make a contribution before April 15th of this year, that amount becomes deductible on your 2014 taxes.
With April 15th fast approaching, it’s time to get creative in finding ways to come up with that extra cash for your retirement account. Here are seven unique strategies that can help you reach your IRA contribution goals.
1. Skip the Starbucks and Restaurant Runs
For the next month, consider cutting back on non-essential expenses like eating out or grabbing coffee to save money. Instead of spending at restaurants and coffee shops, pack your lunch and find free ways to socialize with friends. This may be a big sacrifice for some, but it’s only for one month and could add up to a significant tax break.
Take the amount you would have spent on those indulgences and deposit that money into your IRA account. You might be surprised by how quickly it adds up.
2. Use Your Own Two Feet (or Public Transportation) Instead of Driving
Transportation is a considerable expense for many people. Look at the opportunities to use your own two feet, public transportation, or biking to get around. Once warm weather arrives, you’ll have even more opportunities to avoid driving by walking and cycling. By doing so, you can bank that transit money right into your IRA.
3. Delay Personal and Home Makeovers Until After April 15th
Many people look forward to a personal and home makeover once the warm weather arrives. However, if you can delay making any purchases for the next month, you can use that money to contribute to your IRA instead. Think of it as giving your future self more freedom by putting that extra cash towards your retirement now.
4. Calculate Your Itemized Deductions and Plan Ahead
Some people don’t want to go through the hassle of itemizing their expenses because it can be time-consuming and requires additional organization and paperwork. However, if your itemized deductions are greater than the standard deduction, you could save on taxes you owe or get a bigger refund. Calculate your potential savings and put that money away in your IRA now to enjoy later.
5. Maximize Your Student Loan Interest Deduction
If you make less than $80,000 per year as an individual (or less than $160,000 if filing jointly), you can deduct the interest you’ve paid on student loans. Use that money saved on the deduction to increase your contribution to your IRA.
6. Opt for a “Staycation” This Spring
With all the travel deals available, it can be tempting to plan an exciting vacation as soon as spring hits. Resist the urge and make your spring break into a staycation instead. There are plenty of events and activities in your hometown that will help you rediscover it like a tourist in your own backyard.
The money saved by skipping that trip can go straight into your IRA account, allowing it to grow faster.
7. Delay Big Purchases and Get the Most Out of Your Durable Goods
We often fall victim to upgrading our electronics and other items as soon as a new, shinier model comes out. However, in six months, there’s always going to be something more advanced and likely not much more expensive than today’s top-of-the-line products. Get the most value out of your current durable goods and only replace them when it’s truly necessary.
The money you would have spent on those upgrades can be put directly into your IRA, allowing it to grow faster and providing you with more financial security in the future.
Conclusion
Maximizing your retirement savings is a smart move that will pay off in the long run. By implementing these seven creative strategies, you’ll be able to boost your IRA contributions by April 15th and set yourself on a path towards a comfortable and secure retirement.
Remember, it’s never too late or early to start planning for your future financial security. Start today!
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