Win the Retirement Race

Planning for retirement usually takes a lifetime. Along the way, you'll encounter plenty of distractions that can take you off the shortest path to financial independence. To reach the finish line, you've got to train yourself to avoid those distractions and keep moving forward.

Here are some pointers to keep you on track to win your retirement race.

Start slow
Just as a journey of a thousand miles begins with a single step, saving for retirement starts with a single dollar. While you'll reach your goals faster if you can save more, don't let yourself think that you might as well not bother with small amounts.

The fact is that whether you save a little or a lot, your total nest egg won't reach astronomical heights in those first few years. Yet that initial stage of retirement saving is crucial in order to let you take bigger steps later in your career. So don't get discouraged even if you think you're moving at a snail's pace at first -- you'll pick up steam later on.

Keep steady
As you get comfortable with your retirement planning, you'll naturally find ways to do better. Getting raises or higher-paying jobs will let you make bigger contributions to IRAs and 401(k) plans, helping you collect employer matching contributions and some income tax benefits as well.

When things are going well, you'll be tempted to try to cut corners. For instance, when markets perform well over several years, your nest egg will grow faster than you expected, and you might want to take on more risk in search of even greater rewards. Lately, it's been the energy and commodities sectors that have brought big returns, with ExxonMobil (NYSE: XOM) up more than 22% per year over the past five years, and mining giant BHP Billiton (NYSE: BHP) up nearly 49% annually since 2002. Even if you're enjoying good returns, it's hard not to get greedy when you see even better ones.

But don't get impatient. Even though high-risk stocks can produce greater returns, buying them after big gains leaves you exposed to big potential losses. Plenty of people learned that in 2000 and 2001: Companies like Yahoo! (Nasdaq: YHOO) and Amazon.com (Nasdaq: AMZN) recovered, but such giants as CMGI (Nasdaq: CMGI) and JDS Uniphase (Nasdaq: JDSU) never really recovered. If you try to race ahead early in the game, an unexpected setback could leave you unable to reach the finish.

Stay healthy
Even though a comfortable retirement is important, you have plenty of competing priorities to think about. Spending all your energy on one goal might seem like the best way to focus, but neglecting other necessities early could cause much bigger problems later.

For example, if you want to help put your kids through college, you'll probably need to divert some of your cash flow toward a 529 college savings plan. You might not want to slow down on your retirement savings, but by moving a bit of your money now, you'll avoid having to make more dramatic adjustments later on.

Finish strong
Toward the end of your career, you might start feeling like you've saved enough. By now, your nest egg probably looks unimaginably large, and you might not think you'd ever need that much money. But with life expectancies getting longer and typical expenses for seniors growing faster than the rate of inflation, you'll need every dollar you can get. You could easily live 30 years or more after you finally hang up your work shoes.

So before you turn in your resignation, consider what you want from your retirement. There are plenty of things you can do to supplement your savings, whether it's working an extra year or two, taking a part-time job, or delaying your Social Security to get a higher benefit later on.

Whether you've got plenty of miles under your belt or are just getting started on the road to retirement, this simple game plan will help you reach your retirement goals. Just keep in mind that you're in it for the long haul. If you keep your discipline, you'll reach the finish line in style.