A piece of advice from my dad has defined my retirement strategy since my early 20s - Business Insider

One employer offered a match of 50 cents for every dollar up to 6%. The first year, I made sure to auto-contribute the full amount. And each year I bumped up that amount by 1%. By the time I left my post, I was putting away 12% toward retirement.when I was in my early 20s. Truth be told, I put in $100 and soon neglected to make further contributions. But when I transitioned to freelancing, I opened an IRA and set up auto-deposits so that I could contribute the max amount each year.

I typically try to contribute to the employer side first. That's because the limit is lower — 25% if you're a small business, and there's a special formula if you're technically self-employed — and I'm more confident I'll hit that limit. Once I max out on the employer side, I'll tackle making contributions on the employee side. For 2020, as an employee, you can tuck away up to 100% of your earned income, or up to $19,500, whichever is lower.

Like my IRA, I auto-contribute, so I save the maximum each year. In 2020, the amount you can contribute if you're single is capped at $3,550. My auto-deposit is set for every week, and I treat it like any other expense. Allow me to get super nerdy here. As a pastime of sorts, I like to plug in some numbers into ato see how much I'll have saved in each retirement account by the time I'm, say, 70. This free tool helps me figure out how much I'll have for my nest egg.

Despite the uncertainty that is looming, I still prioritize saving for retirement. I might make adjustments and lower my contributions if necessary. But for the most part, I treat it like any other regular living expense. That way, I stay on track with my goals.

This is fanstastic. Start early and watch the power of compound interest take over!

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