Did you get a chance to read out last blog yet? If you did, then you already know that it is very important to start saving for retirement as early as possible. To recap, saving now allows you to earn more compound interest, and it also gives you freedom and peace of mind, but how do you start saving? The following is a list of tips from our investment advisor in Naples to help you start saving for retirement, the smart way:
- Take advantage of your company’s 401(k)- A company-run 401(k) is a great place to start saving for retirement. Some companies will even match what you contribute after a time. The very best part about 401(k) contributions is that they come out before taxes, so you won’t miss them on your paycheck. Extra tip: increase your contribution amounts when you get raises or after you pay off debt.
- Don’t let expenses get in the way- When you are young, and you don’t make a lot, it can be really difficult to save. Practice living below your means, and start saving every penny that you can now. You’ll thank yourself later on.
- Open a Roth IRA- If your company doesn’t offer a 401(k) plan, you can still start saving by opening a Roth IRA. However, unlike a 401(k), contributions to a Roth IRA happen after taxes. The good news is that you won’t have to pay taxes when it comes time to withdraw your funds. Make contributing easier by getting a portion of your paycheck direct deposited into your Roth IRA. That way, you won’t miss it in your checking account!