A rise in the cost of living has presented challenges to millions of households across the globe. As the cost of everything from food to natural gas to fuel for vehicles has risen, many people have struggled to find ways to save money, especially for their long-term goals like retirement.

The term “nest egg” has long been associated with long-term financial goals like retirement savings or college tuition. But what are individuals to do if short-term costs get in the way of their long-term goals? There’s no magic formula for building a nest egg, but these tips can help anyone grow their savings despite the high cost of living.

• Identify a specific, achievable goal. Simply resolving to save “more” without attaching a figure that defines what “more” is can make it hard to build a substantial nest egg. Examine your finances, including what’s coming in each month (i.e., take-home wages) and what has to go out each month (i.e, housing and automotive costs, etc.). Document these expenses and then identify an achievable goal to build your nest egg. If necessary, trim some fat related to monthly expenses that are not necessities so you can redirect funds to your nest egg. Cancel streaming services or cut back on dining out so those funds can be redirected to building a nest egg.
• Take advantage of pre-tax opportunities to save. Pre-tax opportunities to build a nest include retirement vehicles like a 401(k). With these plans, money is deducted from a paycheck before taxes, thus lowering workers’ immediate tax burdens (taxes are paid when funds are withdrawn) and enabling them to save more now. Some employers even match contributions up to a predetermined percentage, so enrolling in plans that offer employer match contributions can be an especially effective way to build a nest egg.
• Begin living on a budget, and stick to it. The idea of living on a budget may seem simple, but it’s less common than some may recognize. A 2023 survey from the online financial resource NerdWallet found that 83 percent of the more than 2,000 adults 18 and over who participated acknowledged they overspend. Perhaps more telling is that 84 percent of respondents indicate they have a monthly budget but exceed it anyway. Individuals who want to build a sizable nest egg are urged to work with a financial advisor to devise a monthly budget and then stick to it.
• Save for emergencies. A lack of emergency funds can quickly jeopardize a nest egg. Without a somewhat sizable savings account, individuals could be forced to borrow from their retirement accounts in emergency situations. That strategy hurts in more ways than one, as it both reduces the amount in the nest egg and also affects how much the nest egg can grow, as gains are greater when balances are higher. The NerdWallet survey found that 48 percent of respondents want to prioritize emergency savings, and that strategy can be vital to building a nest egg.

A sizable nest egg can help anyone live comfortably in retirement, and various strategies can help people grow their nest egg even as the cost of living remains
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