Everyone knows that planning for retirement should be the first item on the top of the “to do” list but too often it is put off for a future time. Everything seems to come before retirement, but planning for your future should be a priority. Have you started a retirement savings program yet? The average American needs approximately 20 years of salary for retirement. This average means that retirement savings should begin with your first job.
Saving is Critical
According to the federal government, less than half of Americans have researched how much they will need to retire, and 30 percent of people with access to a 401(k) do not participate. Saving for retirement is a habit everyone can establish, and one that will help secure your retirement.
You may already have a savings account. If you do, put a set amount in each payday. If you don’t have a savings account, now is the time to open one. Even if you have to start with a small amount, you can start increasing that amount a little bit each month. Make your savings account the first bill you pay each month. Make a savings plan and stay with it. No matter how far away retirement seems today, it takes years of saving to be ready.
Employer Retirement Savings Plans
According to the Law Office of Ione Rummery, a San Marcos CA local trust and probate law attorney, if your business offers a 401(k) plan it’s a great opportunity to save for your retirement. Lower taxes, company contributions, and automatic deductions make this an excellent way to save. The final amount will be affected by compound interest and tax deferrals, which will benefit you and your retirement fund.
Employer Pension Plans
Some employers offer a traditional pension plan. Find out if you are covered by it, and ask how it works. An individual benefit statement will disclose how much your benefit is worth and if it has spousal benefits. If you have not been aware of pension plans before, you should check to see if you have any benefits that accumulated from a previous employer.
Planning ahead will help you prepare for a comfortable retirement. Examine all the options available to you, check past employers for pension plans, and always have a savings plan that you faithfully pay into on every paycheck. If you take all these precautions, your retirement will be secure and comfortable.