Did you think it was ever possible to save one million dollars without winning the lottery? I am here to tell you that it is definitely possible even if you start now. Assuming you have about 30 years until retirement, I have some tips and tricks that will surprise you when it comes to saving one million dollars for retirement.

Opt-In to Your Employers 401K (With Matching)

This will be the most important step you can take to reach one million dollars if your employer has this option. 30% of employers offer a 401K plan and of those companies, only 1 in 4 employees do not participate in the match, according to Financial Engines. 1 in 4! That is too many people missing out on free money.

Assuming your company offers the most common 401K match which is 50 cents for every $1 you contribute up to 6% of your pay, you could be closer to your one million dollars before you know it. Let me show you an example:

$50,000 annual salary

Your contribution: 6%

Company contribution: 3%

Expected Rate of Return on Investment: 8%

Years to Invest: 30

Total at retirement: $626,464

If you do not have retirement through your company, or if your company does not offer a match of any sort, you would have to invest 9% of your salary to get the same outcome.

Fun Fact: Saving for retirement can save you money on taxes since it is tax deductible meaning that you can subtract your retirement savings from your taxable income which reduces the amount of taxes that you need to pay.

Invest Your Tax Refund

Who know that your tax refund can help you reach one million dollars in savings!?!?! The average person/family received $3,100 in tax refunds for the 2015 year. (This number should be closer to zero but we will talk about that in a different post). Let’s see what would happen if you invested your tax return every year for the next 30 years:

Annual deposit: $3,100

Expected Rate of Return on Investment: 8%

Years to Invest: 30

Total at retirement: $351,178

Skip the Coffee

What? Saving one million dollars is as simple is skipping a cup of coffee?!?!

Stopping for coffee everyday can get expensive. I am not saying never stop for coffee again because I know I couldn’t do that (I love coffee, please don’t judge me). Let’s just say, once in a while, we grab some of the free coffee at work or prepare our coffee at home for a lot cheaper. Assuming each cup that we stop for is $5, if we skip the coffee just 10 days out of the month, we can save $50 per month for retirement. Let’s see how that works:

Monthly deposit: $50

Expected Rate of Return on Investment: 8%

Years to Invest: 30

Total at retirement: $74,518

So let’s take a final tally of how much we saved:

$626,464 + $351,178 + $74,518 = $1,052,160 total saved at retirement

As you can see, you can save one million dollars in 30 years, it is not impossible. There are lots of variables when it comes to investing for your retirement and you should always consult your financial advisor for a more personalized plan. If you have started saving for retirement, that’s great! If not, now you know that you still have time to make retirement contributions. So how are you doing saving for your one million dollars?

Jeremiah 29:11 – “For I know the plans I have for you,” declares the LORD, “plans to prosper you and not harm you, plans to give you hope and a future.”