7 tips to help make saving for retirement easier, according to a financial planner

Although you may strive to save up a million dollars for retirement, Smith said to set smaller, regular goals, not a random final dollar amount.

"While there is no one number Americans should have saved when they retire, it is important to set a target so you know if you’re headed in the right direction," he said. "For instance, set the goal to have ‘x’ amount of dollars saved by age 'x.'"

"The first step to choosing the right retirement date is to determine a savings goal based on your intended retirement lifestyle and the number of years you expect to live in retirement," Smith said. "You can use online calculators or talk to an investment advisor for help arriving at a preliminary number based on your current spending levels and estimated expenditures during your retirement years."

Make sure to take the lifestyle changes of retirement into consideration. "For example, your transportation costs might decrease, since you’ll no longer be commuting to work, but the cost of utilities might go up as a result of your spending more time at home," Smith said.

He also said to keep in mind that a financial plan is simply a piece of paper, so it's important to review it regularly and make adjustments as needed.

Smith said that saving as much money as you can, for as long as you can, is key. He suggested contributing to a 401(k) if your company offers one, and/or a Roth IRA.

"If your company offers a 401(k) match program, consider maximizing your contribution to receive the full company match,” he said. “Unfortunately, many people miss out on this free money."

Smith added that, according to a report from Financial Engines, Americans leave $24 billion in unclaimed 401(k) company matches on the table each year.

For those without access to a 401(k) plan, such as freelancers, Smith suggests a Roth or traditional IRA. Also, with the help of an accountant, "freelancers should also explore accounts that allow for higher savings, like solo 401(k)s or SEP-IRA options," he said.

Chances are, you can cut extraneous things from your budget, such as a gym membership you don't use or a streaming service you haven’t logged into for months.

"Reduce spending money on things that are more luxury-type items and 'wants' as opposed to 'needs,'" Smith said.

He suggested cutting back on eating out, renting movies instead of going to the theater, and getting a water filter instead of buying bottled water.

"If you make small changes in your spending habits now, you’ll have more money to invest, which will eventually make a big difference in your retirement years," he said.

While you may want to set aside as much as you can for retirement, you still need to take care of present financial needs, like paying off debts. However, there’s a caveat to this, Smith said.

"While it may sound counterintuitive, I advise people to aggressively save for retirement rather than racing to pay off student loan debt when they graduate," he said. "The tax breaks, employer matches, and compound interest that retirement contributions offer are worth far more than the interest saved by accelerated student loan repayment."

Although it may be tempting to borrow money from your 401(k) — particularly if you have a financial crisis like losing your job or a health emergency — you should probably avoid it.

"Banks make you jump through too many hoops for a personal loan, credit cards charge too much interest, and suddenly, you start looking at your 401(k) account," he said. “But take a second to see how this could adversely affect your retirement plans."

For instance, Smith said if you take out $10,000 from your 401(k) in a 10-year loan, and assume a 5% interest rate on the loan and an average 8% rate of return, you’ve lost more than $4,000 in earning potential.

"Instead, prioritize setting aside three to six months of savings in an emergency fund so you can tap that first versus your retirement nest egg," he said.

Health care is one of the largest expenses for many retirees.

“Unfortunately, many people greatly underestimate how much they will need to cover out-of-pocket health care costs throughout retirement,” Smith said.

According to Financial Engines' financial literacy quiz, more than half (58%) of those 65 and over — and three-quarters (76%) of those ages 55 to 64 — believed the typical married couple retiring today at age 65 will need between $50,000 and $200,000 for health care.

According to an annual estimate by Fidelity released in April 2018, the average couple retiring at age 65 will need $280,000 for health care and medical costs, according to Time.

Smith said to keep in mind that while Medicare is a solid foundation for health care costs, it doesn’t cover everything, like routine services such as dental care, dentures, vision and hearing care, and long-term care.

"If you don’t know how health care expenses could affect your retirement or whether you’re saving enough for your future needs, talk to a financial professional," he said.