Simple ways millennials can save for retirement

Retirement seems like something that is decades away, but it is coming up sooner than you think! Most 30-somethings might push off the thought of retirement because the thought of saving for retirement is daunting and a bit confusing. It doesn’t have to be that way. We are going to break down some easy ways to prepare yourself now so your “future-self” will thank you.

A 401(k) is a tax-advantaged way to save for the future.

An easy way to save is with your employer-sponsored 401(k) plan. A 401(k) is a tax-advantaged savings plan where employees can deduct a portion of their salary from each paycheck and have it invested. Typically, employers will contribute a certain percentage to the plan, and it is often referred to as a company match, but it is important to check the details. The money in the 401(k) plan may be able to grow tax-deferred or tax-free.

How do you set up a 401(k)?

When you start a job, part of your onboarding materials should explain how to enroll in a 401(k) plan. It can vary with each employer, but employees can have the money deducted automatically and deposited into a 401(k) account. The account will accrue with every paycheck and develop a healthy retirement fund for the future. Be sure to confirm with your employer if you have questions about the specifics of your plan.

Is there an alternative to a 401(k)?

What do you do if your employer does not offer, or match contributions to, a 401(k)?  Consider an IRA as an alternative. An IRA is an individual retirement account that allows eligible participants to benefit from a tax advantaged account to save for retirement. With an IRA, your money can accrue tax-free or tax-deferred until retirement.

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Don’t wait to save. Saving for retirement has never been easier to set up and the earlier you get started, the better! If you have questions, contact us.