Four steps to saving for retirement - WKOW 27: Madison, WI Breaking News, Weather and Sports

Four steps to saving for retirement

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MADISON (WKOW) -- A Madison financial planner says "March Madness" can remind us how to handle our money. 

Mark Farnan is with Retirement Income Planning, LLC and says the excitement around the games can help you remember some valuable financial lessons.

First, Farnan says to make sure you tune into your money situation just like you would tune into the games. Half of American workers have nothing saved for retirement, Farnan says.

The first thing to do is set your goals. Farnan says just like you build a bracket, think about your end game. Do you want to travel? Do you want a lake house? After you have your goals set, think about how you can get there. 

Building your bracket is a lot like building your budget, Farnan says. Keep track of how much you're spending and make sure it's less than your income. "Just like you weed out the teams you don't think will make the cut in your bracket, in a budget, you're weeding out the expenses that won't make the cut," Farnan says.

Farnan says to also watch out for "busters."  Your budget can be busted by an unexpected emergency, health problems or losing a job. You can prepare for that by building an emergency fund. Farnan recommends keeping a separate account with three to six months of your income saved. 

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