Reflections on Retirement: A mindset of preparing at every age, plus contribution limits increase for 2019

For the last part in our series “Reflections on Retirement,” we’re offering some words of wisdom from our UFHR colleagues and a retirement vendor. If you missed earlier stories in the series, here are part one, part two and part three. We hope these stories have shed some light on your journey toward retirement, whether it’s mere months or several decades away. We’ve also included information about an increase in retirement plan contribution limits for 2019.

One of our colleagues in UFHR said that she had barely started saving for retirement in her first job when the market crashed in 1987. In a common reactive move, she reallocated her funds outside of the stock market and into a more conservative interest-earning fund.

“In retrospect, I feel really stupid about having done this, although it was probably more a sign of youth and lack of knowledge or support from an experienced advisor than anything else,” she said. “A real lesson in retirement savings and planning; perspective is a great teacher.”

She said that as a person in her 20s and with very little money invested, she had years ahead to benefit from the risk and fluctuations of the stock market, but her immediate reaction was to avoid any losses rather than to maximize gains.

“It’s a classic cognitive bias mistake,” she said. “While I started saving early, I did not maximize the growth of those savings because I was not willing to deal with the immediate unpredictability of the market. Now I know that, in the long run, taking that risk when you are young can pay off. I hope my lesson helps others, especially these days when we are seeing relatively dramatic fluctuations in the stock market.”

Another colleague shared that, as she has gotten older, her priorities have changed.

“I’ve found that experiences matter more to me now than material things,” she said. “I want to save so my husband and I can have more experiences in retirement, and this mindset is helping me avoid impulse buys in order to save money for the future.”

The investment provider VALIC has the following tips for saving during various decades of your life and career. Learn more below and let us know if you have a piece of advice to share. (If so, please submit it here).

20-something and starting your career
When job hunting, a 24-year-old is probably looking at salary and not company benefits. But remember to ask yourself, “Does this prospective employer offer an employer-sponsored, tax-deferred retirement plan? And does the employer contribute to my account?” (Learn more about the FRS Pension, FRS Investment and SUSORP plans at UF and employee/employer contribution information, including a comparison of the three plans.) It’s important to start saving early so your retirement account will have the opportunity to benefit from decades of compounding interest. Not making much money? That’s okay; you can start with small contributions and increase them later. Here’s another tip: Do your best to avoid credit card debt. Overuse of credit cards can sabotage your financial fitness.

In your 30s and settling down
This is a decade where your financial situation can get crowded — a mortgage, insurance, maybe a college savings account, life insurance, clothes and computers for kids. Seems like something should take a back seat, but which thing? You want to do right by your children, but don’t shortchange yourself. If all of your savings goes into college accounts, you could find yourself dependent on your children in your later years. Help your kids understand that they share the financial responsibility for their college education. Work out a process for shared responsibility. Remember, experts tell us that you can borrow money for college, but you can’t borrow money for retirement.

40+ and focused on your future
Saving is still important, but also consider that you will not have a lot of time to recover should the market suffer a stiff downturn. Check with your financial advisor to see if your investment mix reflects your age, time until retirement and tolerance for risk. Such issues become more important as you get closer to your projected retirement age. While you’re talking with your financial advisor, ask if you have a “retirement gap” (a gap between how much you’re projected to have at retirement age and how much you’ll need) and what steps are needed to fill the gap.

50+ and shifting gears
Keep saving, of course, but also give some serious thought to your strategy for how to design your withdrawals once you start tapping into your savings. Do you have a withdrawal strategy to keep from using up your funds and leaving you penniless? How does Social Security integrate with your withdrawal strategy? Do you have debt hanging over it all? It’s a lot to think about and you might find it overwhelming. Call your financial advisor to talk it over.

The preparation is worth it
Thinking ahead and preparing a financial strategy can help you lessen unpleasant surprises later on. Face tomorrow with more confidence; work with a trusted financial advisor to strategize for your future.

Retirement plan contribution limits increase for 2019

And speaking of saving, with a new year just around the corner, it’s a great time to increase your contributions or start a voluntary retirement plan to maximize your tax savings.

The IRS recently announced the retirement plan contribution limits for 2019 as follows:

  • The elective deferral limit for 403(b) — all Roth and tax-deferred contributions combined — is increased by $500 to $19,000.
  • The elective deferral limit for 457(b) deferred compensation is increased by $500 to $19,000.
  • The 415(c)(1)(A) defined contribution limit (employer + employee contributions) is increased by $1,000 to $56,000. This affects all employer and mandatory employee contributions to the FRS Pension, FRS Investment and SUSORP plans plus any voluntary employee contributions to the SUSORP, tax-deferred UF 403(b) and post-tax Roth UF 403(b).
  • The catch-up contribution limit for employees aged 50 and over (as of Dec. 31, 2019) remains unchanged at $6,000.

Information on retirement plans offered by UF and forms needed to change or initiate your deferral can be found on the Retirement section of the UFHR website. If you have questions, contact UFHR Benefits at (352) 392-2477 or

We asked readers for their retirement tips! Here’s what they shared.

“I don’t even remember who gave me this advice sometime towards the end of grad school in the late 80s: ‘Always spend your last pay increase not the current one.’ That advice made sense to me intuitively. I lived and have done well with it.”

-Edzard van Santen, PhD, Agronomy Department, Institute of Food and Agricultural Sciences