Be An Early Bird When It Comes to Retirement Planning - It’s Never Too Soon To Start Saving For Retirement
The days of parties and all-nighters will soon be behind the class of 2005. Even though retirement is the last thing on young adults’ minds, now is actually the best time to start thinking about it. The sooner you start planning, the more money you will have when that far-off retirement arrives.
San Francisco, CA (PRWEB) June 10, 2005 -- “Early retirement planning” really
means early- the earlier the better. The US Department of Labor reports that for
every 10 years you delay in saving for retirement, you’ll have to save three
times more each month to catch up. Professional retirement planners are advising
young adults to begin thinking about their Golden Years as soon as they start
their first job out of college.
A single person in their 20s has a
considerable amount of “disposable income”, so if you fall into this
demographic, now is a great time to start putting some of it away for when
you’ll really need it.
“A young American has at least 3 actions he or she
can take now that will pay off when they retire,” says retirement planning
specialist Steve Carkeek of Retirement-4-U, a retirement planning firm based in
San Fransico, CA. “First, try to put away at least 10% of your yearly salary
into savings- not savings for a new house, not savings for your future
children’s college fund, but savings for you to live on when you
retire.”
Carkeek also recommends that you enroll in your company’s 401(k)
plan, if it offers one. A 401(k) is a retirement plan that allows you to save a
portion of your income, deferring any income taxes on your savings or the
interest earned by your savings until the time of the money’s withdrawal. Your
taxable income is reduced by the amount of your yearly deposit. Some employers
even offer to match a percentage of the money you put into your 401(k). “Not
starting one is literally like throwing away free money,” says
Carkeek.
If you don’t have a 401(k) plan at work, another wise move in
the early retirement planning playbook is an IRA, or Individual Retirement
Account. The government treats the money in your IRA differently than the rest
of your money. A traditional IRA allows you to save up to $4,000 of your salary
each year, fully deductible and tax-deferred until you withdraw your savings
from the account. There is also what is known as a Roth IRA, in which your
deposits are not tax-exempt, but your interest is. A retirement planner can
better explain the difference and help you decide which is best for
you.
Young people are starting to understand how important it is to start
planning early, especially with the changing workplace and the uncertain state
of Social Security. “It’s not our grandparent’s world anymore, where you could
work for a company for 30 years and get a dependable pension,” says 24-year-old
Houstonian Daniel DiPaolo. ”And Social Security? No one knows what’s going on
with that. I am just getting used to making car payments and cooking for myself,
but I know that planning for the future is really important. I am already
thinking ahead, putting money into my 401(k), and I am actually a little nervous
that I am still not doing enough.”
A professional retirement planner will
assist you in taking the correct steps to achieve your retirement goals, every
step of the way. Retirement-4-U offers early retirement planning services that
take into account complexities such as stock market cycles, inflation data, cost
of living index, and more. No on can predict what will happen between age 25 and
age 65, but a professional retirement planner like Retirement-4-U can help a
person be prepared to adjust their plan at every stage in their life.
Your Golden Years will be here before you know it, and you want them to
be truly golden. It is never too early (or too late) to start planning for your
retirement. For more information, visit www.Retirement-4-U.com.
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Source : http://www.prweb.com/releases/2005/6/prweb249271.htm