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Work & Money

Ace Your Retirement With This Free AARP Tool

In the time it takes to make a cup of coffee, learn easy steps to growing your money.

Sisters step up for loved ones in need. It’s what we do. Perhaps you or someone close to you is busy raising a niece, nephew or grandchild. Maybe you’ve loaned money to an adult child or handled some bills for an aging parent. You may spend time on a committee connected to your house of worship or sorority. Black women find so many ways to be everyday “sheroes” for those who matter to us. But while spending time and money helping others, we may divert resources we need to help ourselves to a secure retirement.

Hey, we’re human. Even though I write about personal finance, I occasionally fall short on taking some of my own advice. For instance, I may focus on loved ones’ immediate money needs rather than on how much I need to invest now to fund that future nest egg. I’ve offered to help pay for a relative’s tuition and to send my sweet li’l cousin funds through a money transfer app. Then there was that time I picked up the bill for not one but two hotel rooms during a family vacation mishap. After discovering we’d need to move from a hotel that turned out to be unfit to a nicer one, I knew others couldn’t afford to pay for the upgrade, so I waved my AmEx. That’s just who I am. While caring for my husband and our kids, I’ll always be there for our enormous extended family, offering my time, talent and tutelage on everything from raising babies to building nest eggs.

But when being there involves hard-earned cash, those little (or large) hits to our wallets can mean we’re postponing steps needed for financial security. Perhaps that means you’re not getting the full match on a 401(k), you’re relying solely on Social Security to support you in your later years or your rainy-day fund is running dry.

In my case, at 47, I feel blessed to have an emergency savings account, a 401(k), a Roth IRA and life insurance. But none of those accounts are funded at the level they should be given the fact that I am exactly 20 years away from my target retirement age. Plus, as much as I don’t want to think about it, I may very well outlive my husband of 20 years. According to recent data from the World Health Organization, women generally live longer than men, on average by six to eight years.

For Black women over 40, the time to focus on ourselves and our retirement is right now. This doesn’t mean that we ignore the needs of others — just that we prioritize our own needs and take action. “The earlier you start saving and investing, the longer your money has to use the magic of compounding interest and the more likely you are to reach your retirement goals,” says Merrie Allmon Allen, a certified personal finance educator and author of Money Management Wisdom: 8 Steps to Living Your Best Life. “It is never too late to start preparing. Something is always better than nothing.”

If you’re wondering what steps to take, here’s a place to begin. In the time it takes to make yourself a cup of coffee, Ace Your Retirement brought to you by AARP and the Ad Council, can provide you with a personalized set of manageable action steps. This free, private online tool offers you a session with AvoSM, AARP’s digital retirement coach. Once you click the bright yellow “Start Chat” button, Avo will ask you a series of questions like your age, whether you have kids, whether you are married and how long until you plan to retire during a three-minute chat. Detailed stuff, but not overly intrusive, in my opinion. Think of it as a quick consult with a virtual money pro.

Avo asked me, “Do you see yourself working during retirement — on a part-time basis or as a freelancer or a consultant?” I answered, “Yes!” and Avo gave me a friendly thumbs-up. Avo replied that doing so is “a smart move because earning income after retirement means you can continue to save and avoid cracking open your nest egg for smaller living expenses.”

At the end of the three-minute session, Avo presents three doable action items with mini steps to get started. This can be the motivation you need to write a realistic savings plan, increase your 401(k) contributions by a percentage or two or learn how to get the most out of your Social Security benefits. And as your money situation changes, you can check in with Avo again to gain some new insights. The mini action steps can make your retirement planning feel achievable instead of overwhelming.

“When you are trying to give one hundred percent to the job, kids, spouse, church and community, retirement planning just doesn’t seem to make it to the top of the priority list,” says Allen. “For the most part, we know we must do something, but with all the choices available we don’t know where to start, so we delay.”

Learning fundamental financial principles like living beneath your means, paying off debt and saving and investing will make retirement planning less intimidating. Using tools like Avo is a good place to start. You deserve to live the life of your dreams. Start today. Believe me, your future self will thank you.

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