You know that little voice in your head that’s been bothering you lately? It’s telling you that you may not have enough for retirement, right? Well, you’re not alone. Here in America, 75% of us that are over 40 actually are significantly behind on our retirement savings. So how can you tell that you’re off course? We’ve got you covered.
1. You’re only saving through a 401K
If you’re lucky enough to have an employer that offers a 401K, and even luckier to be able to make monthly contributions, then you’d think you’d be in the clear, right? Unfortunately, that’s not the case. A 401K is not meant to be your only means of retirement saving, it’s only meant to be one tool for savers. Opening an IRA may be the right option for you in order to be fully prepared for your retirement, it allows your money to grow tax-deferred if in a traditional IRA, and tax-free if in a Roth.
2. You aren’t matching contributions
Now, if you have a 401K, and your employer has a match program, but you’re not taking full advantage of it, you have to reevaluate your contributions. That’s free money that you’re missing out on. The average employer contribution is around 6%, up to a certain amount. Get in touch with your company’s HR team, and make sure that you’re contributing enough.
3. You’re unsure of how much to save
One reason this is such an issue is that the amount that one person will need at retirement is different from another person, and also depends on when you start saving. If you started saving in your 20’s, 10% of your gross income is standard, but if you’re 30+, 15%-25% is ideal. Calculate the end total of what you will need based on your income with the Social Security Quick Calculator.
The most important thing to remember when it comes to saving for retirement is just to save. Save. Save. And Save. And contact us today if you want to open an IRA.