Simple Rules Of Saving For Retirement

BOSTON (CBS) - All this week we are going to cover some of the simple finance rules from The Simple Dollar that lead to personal success.

Focus on saving for retirement. The author suggests that once your high interest debts are out of the way, start saving for retirement. And I agree with paying down the debt but disagree that you should wait to save for retirement. I believe you should be able to save for retirement while paying down the debt. You will never get back those early years of retirement savings. Even a small amount will make such a big difference in 30 years. Use your retirement plan at work or set up an IRA.

Don't touch your retirement money if at all possible. When you're struggling to pull yourself out of a financial hole it can be very tempting to tap your retirement funds to pay off debts or to make a house down payment or use the dollars for college for the kids. You will you lose out on years of growth in your retirement nest egg and possibly never catch up. It should be the last resort.

Get every possible dollar of employer matching in your 401(k) or 403(b). If your employer offers matching funds for your 401(k) or 403(b) plan, make sure you're contributing enough money to get every single dollar of those matching funds. It's free money. It allows you to get an immediate return on every dollar that you save for retirement.

Buy term life insurance to cover your dependents. You don't need much life insurance unless you have dependents (these are the folks relying on your income for support). Your best bet is to get a term life insurance policy, one that will pay out enough money to care for your dependents in the event of your early death.

And most individuals do much better if they purchase just term insurance and learn about savings and investing on their own.

One more thing: To figure out how much life insurance coverage you need use the worksheet at the For Dummies website or the one on my website.

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You can hear Dee Lee's expert financial advice on WBZ NewsRadio 1030 each weekday at 1:55 p.m., 3:55 p.m., and 7:55 p.m.

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