5. Have adequate emergency savings
A lot of people have had to tap their retirement savings this year because they didn’t have enough emergency savings to cover a job loss or whatever other unexpected expenses have arisen because of the pandemic. Making an early retirement withdrawal is better than losing your home or ruining your credit, but it will set you back in your quest to becoming a multi-millionaire.
You should have an emergency fund containing at least three months of living expenses, and six months is better if you can manage it. Replenish this every time you use some of it so you’re always prepared for the next emergency. That way, you have something other than your retirement plan to fall back on.
Following the five tips above can help you on your way to retiring a millionaire, but the key is consistency. Doing these things for one or two years isn’t enough. You need to follow these principles every year and stay abreast of any updates to the rules surrounding retirement plans, like changing contribution limits, that could affect you.
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