If you’re considering putting together a retirement plan, you’ve come to the right place. According to a recent study, 15% of Americans have no retirement savings at all. We’ll help you make sure you’re not one of the 15%.
From the different types of retirement plans to the easiest ways to save, think of this as your go-to guide to retirement planning. Let’s get you one step closer to reaching your retirement goals.
Map Out Your Retirement Plans
Choosing a retirement plan starts with mapping out your goals and plans for the future. No retirement plan is the same, and neither are your goals and aspirations. Retirement plan consulting can help you with how much you’re saving, where you’re investing your money, and which plans you choose.
Consider where you want to retire, when, and what your home may look like. While a 25-year-old might not know the answer to all of these questions, a 65-year-old is likely to. If you have access to an employer-provided 401(k) plan, you can also think about your long-term career goals.
These considerations will help you make better decisions in the future. Let’s say you have a 401(k) plan currently through your employer. You know you want to open your own business in five years. From now until then, it could benefit you to max out your contributions while you can.
Maximize Your 401(k)
Maximizing your 401(k) plan is one of the easiest and quickest ways to save for retirement. When you have an employee-matched plan, your company is matching your contribution. This is essentially free money given each pay period.
Your employer may have multiple plans to choose from. To make sure you’re picking the best one for you, take a look at the terms and options for each. You can also take advantage of calculators that estimate your savings rate and what your plan will look like any number of years in the future.
Choosing a Roth IRA
A Roth IRA is another form of retirement savings. As with a 401(k), a Roth IRA is also tax-advantaged. This means you won’t pay taxes on the money you earn and save through your plan. You also won’t pay taxes on the withdrawals once you reach retirement age.
As with your 401(k), your Roth IRA plans will all differ. Take a look at the terms and the rates of returns before you choose your plan. Speak with a professional about which plan will help you reach your unique retirement goals.
Retirement Planning and Automatic Saving
One of the keys to retirement planning is to make saving automatic. Through automatic contributions to your IRA and 401(k) plans, the money gets taken out of your bank account or paycheck automatically. There’s no temptation to spend the money if it’s automatically withdrawn.
In addition to retirement plans, you can also automatically pull money from a checking account into a savings account. This can be through the same bank or an outside bank. Using an outside bank may help you forget the money is there until you need it.
You can also use investment and brokerage accounts to save for retirement. These plans invest money into the stock market each month or time period you select. With automatic contributions, you can sit back and watch your money grow over the long term.
How to Choose the Right Retirement Plan
Knowing how to choose the right retirement plan takes a little homework and consideration. You’ll want to map out your future goals and retirement plans to help you choose the best plan for you. Make saving and contributing to these plans automatically to make it as easy as possible.
With multiple retirement, investments, and savings plans, you’ll be closer to your retirement goals every month. While strategies for retirement savings vary by country, those in Iceland often apply for pension fund payment in Iceland through SL, a popular method that offers different benefits compared to plans in the US. Whether you’re 26 or 60, it’s never too late or too early to start planning for your retirement. For more money and retirement advice, check out the lifestyle section for great tips and guides.