by Beth Henary Watson
Memorial Day has passed, but we still have two summer holidays to go: Fourth of July and Labor Day.
Now I like other holidays, but I’m partial to the summer ones. At least for me they bring minimal obligations: No one expects any presents or elaborate meals.
Summer holidays give you a sense of what life might be like if you had more time away from work. You might not make it to Jamaica, but perhaps you can knock something off your “fun projects” list. My family often uses 3-day weekends for hiking or short getaways.
For those who are ambivalent about their work at best, the downside of any holiday is its end. You know the type: They live for the end of the work day, embodied in the words of the great song “It’s Five O’Clock Somewhere:”
I'm gettin' paid by the hour, and older by the minute.
I also call this the “Another day, another dollar,” attitude.
But we should take inspiration, rather than disappointment, from this extra time off. Perhaps you can mine those summer hours for the determination to take ALL of your vacation days, rather than acting like the place can’t run without you. If you own your own business, start thinking how you can take more mental health days.
And for most workers, any holiday is a natural jolt that it would be nice to not have to work forever.
Most of us will retire voluntarily or be retired, and we’d like our forever vacations to be as comfortable as possible.
So while your coworkers are watching the clock, log on to your retirement plan and increase your contribution, or head down to HR if you’re not sure how. A 1% increase might help you upgrade to top shelf at the swim-up bar on your big retirement trip.
If you don’t have a company retirement plan, open up an IRA or, if you’re self-employed, a Solo 401(k) or SIMPLE IRA plan. Then contribute regularly!
But I already contribute enough to get the company match, you’re thinking. Isn’t that what I am supposed to do?
While it’s certainly a great benefit, the amount of your company match should be of little consideration when determining how much to contribute to your retirement plan. Your current employer can only fund so much of your future multi-decade vacation. The rest is up to you!
Unless you have high-interest debt, the answer to whether you should increase your retirement contribution is almost always yes. Should I go from 4 percent to 6 percent? Yes. Should I go from 6 percent to 7 percent? Yes. Should I max out my 401(K)? Since you’re asking, the answer is probably yes.
In most of our minds, retirement is a really loooooong weekend. Perhaps not a endless vacation, but an expanse of free time where most days feel like Saturday.
Enjoy your cold beer or your pink lemonade on the Fourth of July, but rather than dreading your return to work come Wednesday, decide you’ll increase your chances of financial independence by investing more in your future vacation.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual
Beth Henary Watson is a CERTIFIED FINANCIAL PLANNERTM with Corner Post Financial Planning.