Increase Your Retirement Wealth with This Automated Savings Strategy

Automate Your Retirement Savings: A Simple Strategy for Financial Security

There's the potential to build a huge nest egg without doing a lot of work. Recent data from Northwestern Mutual finds that Americans think it'll take $1.46 million, on average, to retire comfortably. That might seem like a daunting sum, but getting there may be easier than expected. In fact, one simple move on your part could potentially lead to a nest egg that large -- or even larger.

When your savings get automated

When you're reliant on yourself to transfer money into a retirement plan month after month, you have the potential to stray. So a better bet may be to sign up for your employer's 401(k). The benefit here is that your contributions will be taken as automatic payroll deductions so you're not writing your savings a check every month. Rather, you're having that money come out of your pay as a matter of course, effectively forcing yourself to fund your 401(k) consistently.

You may be pleasantly surprised by your results

Regularly funding a 401(k) for many years could lead to more retirement wealth than you may have imagined. Let's say you contribute $250 a month out of your own earnings, which also snags you a $250 employer match for a total monthly funding amount of $500. Do that over 40 years, and you could end up with $1.55 million in savings if your 401(k) delivers an average annual 8% return, which is a bit below the stock market's average.

That $1.55 million is a notch higher than the average amount of retirement savings Americans think they need. And it could certainly make for a very comfortable retirement for you.The $22,924 Social Security bonus most retirees completely overlook