What Do Really Smart People Do to Make a Nest Egg?

Saving for retirement may be easier than you think.

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Saving for retirement is one of those important financial goals that everyone knows about but less than half are ready to handle. In fact, 51 percent of Americans are at risk of running out of money if they retire at age 65, according to a study published in 2012 by the Center for Retirement Research at Boston College. Savvy investors make retirement saving a priority and follow basic strategies for increasing their nest eggs and feeling more confident about their futures.

Pay Yourself First

Smart people pay themselves first. This means establishing a savings goal and taking that money off the top of any income. For example, if you want to save 10 percent for retirement, plan to live off of 90 percent of your salary. Invest the 10 percent in your company's 401(k) plan or an individual retirement account. Commit to paying yourself first instead of waiting until the end of the month to see what's left.

Dump Expensive Debt

High interest credit cards are the biggest drain on investors' income, reducing the amount of money available for savings. Focus on paying off consumer debt quickly by paying more than the minimum amount due and using any extra income, like tax returns, one-time bonus checks or salary increases, to eliminate high interest credit card balances. However, don't let paying off debt derail your savings plans. If you have committed to saving 10 percent of your income, temporarily reducing that amount to pay down debt makes sense. Just be sure to continue saving something each month by paying yourself first. Then increase that amount once the credit card bills are gone.

Get Free Money

More than 70 percent of employers match retirement savings in 401(k) or other deferred-compensation plans, but some employees don't take advantage of this benefit. For every dollar you contribute, an employer typically contributes matching or a percentage of matching funds. This is the same as getting free money. Smart investors maximize their retirement savings by using their employer's money to increase their nest egg faster than they could alone.

Automate Your Savings

Savvy investors know the more automated the savings process, the more likely they are to keep it up. Having retirement savings automatically deducted from your paycheck means the money is invested before you even see it. This makes it easier to live off 90, 80 or even 70 percent of your income because the money never makes its way into your bank account. When setting up an automated retirement savings plan, start with the highest amount you think you can handle. Lowering it later is easier than giving up the cash from your bank account once you are used to seeing the money.

Spend Less

Smart people track their spending each month and look for hidden opportunities for savings that can be funneled back into their nest eggs. They brown bag it once a week or more. They rent DVDs more than they go to the movie theater. They shop in consignment stores or vintage thrift shops for classic styles instead of expensive boutiques. Changing even one spending habit can help boost your retirement nest egg and secure your financial future.