What are some strategies to save more for retirement, if I am contributing the maximum amount to my 401(k) and plan to retire in six years?

I plan to retire in six years at age 64. Fidelity recommends saving seven to eight times my annual salary in my 401(k) by retirement. My current annual salary is $65,000 and my 401(k) currently has $185,000 in it. I'm currently holding 10 of the 30 available investments offered through my company's Fidelity 401(k). I am currently contributing 29% of my salary bi-weekly to my account and my portfolio is moderately aggressive. What other strategies can I use to save more before I retire in six years?

Financial Planning, Retirement, Investing, 401(k), Asset Allocation
Answers
Sort By:
Most Helpful
March 2018

Ok for starters it is important to understand what your retirement expenses will look like.  I find that is the best way to figure out how much you should have saved.  You'll need to make some assumptions like rate of return, other incomes like Social Security, inflation, and life expectancy.  From there you can determine the rough amount of assets you'll need.

Now on to strategies to save more.  First, make sure you are maxing out your 401(k) for you that would be $24,500 this year.  From there I'd also make sure you are maxing out any HSA (health savings account) you might have.  Now it gets interesting ideally getting some funds into a Roth IRA would be great, but this is contingent on income limits.  If you fall under the limits you should be able to contribute another $6,500 there.  If you are over the limits, and have no other IRA's, you could do a backdoor Roth contribution or if your 401(k) allows after tax dollars a Mega back door Roth contribution ( here is a blog I wrote on it http://lifelongadvisors.com/mega-backdoor-roth-one-mega-strategy ).  If you have exhausted all these options your last resort is simply an after tax investment account.  Sounds like you are on your way from a savings stand point I would just highly suggest you get a handle on what you will actually need to retire.     

March 2018