Did you know that 15% of Americans have no money saved for retirement at all? An even greater percentage have too little money saved. If you fall in this category, then you need to start prioritizing savings and investment strategies for your retirement.
However, which strategies are best for your needs? To give you a better idea we’ve organized five proven methods. That way, you can start feeling more confident about the future. Let’s get started!
1. Use Your 401(k)
If your company offers a retirement plan like a 401(k), then it’s important to contribute the maximum amount every year. For whatever you contribute your employer will match it. So, if you put 5% of your salary into the plan, then it will double.
However, if you’re not contributing the max amount of money, then you’re missing out on free money.
2. Put Your Tax Refund Into An IRA
Many people don’t immediately get the money they get from their tax refund. If you fall in this category, then consider immediately putting it into on of the best ira investments.
Not only does this help your money grow out of sight, but it also gives you a tax deduction. Make sure to check out this resource to find the best IRA companies for retirement savings.
3. Open a Health Savings Account
A 401(k) and IRA aren’t the only way you can save for retirement. You can also invest in a tax-deductible health savings account. The funds that you place in this account can be spent on healthcare costs either now or in the future.
And, best of all, the funds don’t expire annually if you don’t use them.
4. Manage Your Investment Risk For Your Age
It’s important to take your age into account before pursuing certain types of investment strategies. If you’re younger, then you can safely make some more high risk, but high yield investments, if you want.
If you lose money, then you always have time to make it back. However, the same isn’t true for older individuals. As such, we recommend sticking to low-risk investment strategies.
5. Use a Simplified Employee Pension Plan If You’re Self Employed
Many people think that they can’t contribute to a 401(k) if they’re self-employed. However, there are solo 401(k)s and simplified employee pension plans that you can put your money into.
You can invest up to 25% of your income (max of $58,000) into this type of plan.
Enjoy Learning About Savings and Investments Strategies? Keep Reading
We hope this article helped you learn about some savings and investment strategies that you can use. The earlier you’re able to start saving for retirement, the more effective your money will be at compounding.
So, start prioritizing investments in your life today. Did you enjoy this article? If the answer is yes, then you’re in the right place. Keep on exploring to find more topics that you’re sure to love.
