All that penny pinching is gonna pay off.

Obviously, the definition of “rich” varies from person to person. For some, being “rich” means having enough money to do what you want and not worry too much about eating the costs. For others, being “rich” means shark-filled pastries and summers on Mars. Let’s talk about the former definition. Y’know, the realistic one. One of the big incentives in carefully managing your personal wealth is the promise of an easy retirement lifestyle. How do you know you’re managing yourself properly, though? You won’t actually find out for years down the line. Well, if you’re doing these three things, you’re definitely on the right track.

Consistent Saving

Naturally, saving money is the cornerstone of a retirement fund. But it’s not enough to start saving right before you plan to stop working. A retirement funds needs a lot of money, the kind of money that you can only get through either decades of careful savings or a spontaneous lottery victory. Since the latter probably isn’t happening, you need to save early and consistently. If, for example, you were to put away $550 every month from age 25 to age 67, you’d end up with around $1.5 million (assuming a 7% annual rate of return). That deposit increases for each year you put it off. If you don’t want to sacrifice your entire income just to make a nest egg, start as early as possible.

Setting Goals and Planning to Reach Them

You won’t know when you’re ready for retirement unless you have a definitive goalpost set. If you want to have X amount of money by X age, you need to work out a plan for how you’re going to make that happen. Can you afford a regular monthly investment? Will you need to cut costs somewhere? Is your plan safe from outside factors like taxes or medical costs? If making a plan for forty years in the future is too overwhelming, break it up. Set smaller goals, like X amount of money in five years. As long as it all adds up in the end, it’s okay to make a plan with a lot of steps.

Carefully Using Social Security

A lot of retirees rely way too heavily on social security checks. At least 1/4 of retired married couples rely on social security to provide at least 90% of their retirement income, and that’s just not a safe bet. Don’t get me wrong, it’s okay to use your social security benefits. By all means, that’s what they’re there for. But social security rates fluctuate depending on governmental and societal factors, so it’s not a good idea to rely on them too heavily. Factor your social security checks in with the rest of your income before you even start getting them. There are calculators online for this.