Estimate your expected expenses in retirement.

Estimating your expenses in retirement is an important first step in developing a retirement plan. Knowing what you will need later may help you adjust your savings or spending now.

There are two types of retirement expenses:

• Essential expenses which are your day-to-day costs of living, such as groceries and utilities. You’ll want to make sure these costs are covered and your bills are paid.
• Discretionary expenses are the fun things. This is the money you’ll be spending on all the activities you’ve dreamed about, like traveling or spending time with your grandkids.

Take some time to consider your expected expenses in retirement, and decide which expenses are essential and which are discretionary.

Make a list of your current sources of retirement income.

We recommend you make a list of your potential sources of retirement income.Your income may come from Social Security, pensions, annuities, rental property, as well as your retirement savings and investments.

These sources of income combined will help to create a “retirement paycheck” that you’ll use to cover your essential and discretionary expenses. When you think about your expenses and income in retirement, at a minimum you’ll want to make sure your retirement paycheck is sufficient to cover your day-to-day expenses. You’ll probably combine income from multiple sources to create your retirement paycheck.

Meet with Fidelity and complete your retirement income plan.

Fidelity helps make planning clear, simple and straightforward. You can get one-on-one help creating your retirement income plan—so you can be ready to retire on your terms. Call 1-866-811-6041.

Pay down debt.

Consider chipping away at your high-interest debt, such as credit card balances and personal loans. Or downsize your home and use the proceeds to help beef up your nest egg.

Paying off debt is important. It can be difficult to save when a big chunk of your money is going toward debt repayment. That's why it's important to have a plan to get out of debt—it can save you money in interest and ultimately help you save more and reach your goals faster.

Maximize your opportunities for saving.

Your retirement plan provides you with opportunities to save that may help to improve your outlook. Consider fine-tuning your savings strategy now. Explore the benefits of Roth in your 401(k) or after-tax contributions with the ease of automated Roth in-plan conversions. If you’re 50 or older, also consider catch-up contributions.

The First American 401(k) plan allows you to choose from several options to contribute to the Plan - traditional pre-tax, Roth and after-tax contributions. With pre-tax contributions and Roth contributions you can contribute to the IRS limit of $24,000 for 2025 or up to $32,500 with catch-up contributions** if you are age 50 or older.

• With pre-tax contributions, you won’t pay taxes now, but you will need to pay them when you withdraw your money in retirement.
• For Roth contributions, you pay taxes now, so you can withdraw your contributions and related investment earnings tax-free in retirement, as long as you meet certain conditions*.
• You can also save an additional $10,000 once you reach the IRS contribution limit with after-tax contributions, and they may also be converted to Roth 401(k) contributions and be eligible for tax free growth. Consider setting up the automated Roth-in-plan conversion.

Be sure to consider all the savings opportunities available to take full advantage of your 401(k) Plan.

*A distribution from a Roth 401(k) is federally tax free and penalty free, provided the five-year aging requirement has been satisfied and one of the following conditions is met: age 59½, disability, or death.

**If your FICA wages were over $150,000 in 2025, catch-up contributions must be made as after-tax Roth contributions in 2026. FICA wages are indexed annually.

Match your investments to your needs.

How you invest is as important as how much you save. Consider letting professionals manage your investments. The 401(k) Plan offers two ways to help.

• Target Date Retirement Funds provide a simple approach to investing. Simply select the fund with a target date closet to the year you plan to retire or begin withdrawing from your account and the fund adjusts its portfolio risk to become more conservative as it approaches the funds’ retirement target date. Target Date Funds are an asset mix of stocks, bonds and other investments that automatically becomes more conservative as the fund approaches its target retirement date and beyond. Principal invested is not guaranteed.
• Fidelity® Personalized Planning & Advice to have the professionals at Fidelity manage your investments. With this service, a team of professionals will create a plan and manage your investments based on the market, your preferences and goals. Professionals will actively research plan options and rebalance your account to ensure your investments adjust as your preferences and time horizon change. Please note there is an advisory fee for this service which will not exceed 0.28% of your managed portfolio¹. Already enrolled? Update your profile annually.

Click here to learn more or call 1-866-811-6041 to speak with a Fidelity Representative.