Retirement might feel like a lifetime away, but the truth is, the earlier you start saving, the easier it gets. Even if you’re just getting started in your career or juggling student loans, there’s no such thing as “too early” or “too small” when it comes to saving for your future.
Why Retirement Savings Matter
Your future self will thank you for every dollar you put aside today. The money you save now has more time to grow, thanks to compound interest, which basically means you earn interest on your interest. Over time, that small amount can add up to something big.
Where to Start
If your job offers a 401(k) or other employer-sponsored retirement plan, start there. Contribute at least enough to get your employer’s match if they offer one. That’s free money you don’t want to leave on the table.
No 401(k)? No problem. You can open an Individual Retirement Account (IRA) on your own. There are two types:
- Traditional IRA: You might get a tax break now, and you’ll pay taxes later when you withdraw the money at retirement.
- Roth IRA: You pay taxes on your contributions now, but your money grows tax-free, and you won’t owe taxes when you take it out later.
How Much Should You Save?
If you’re new to saving, start small. Even 3% to 5% of your paycheck is a great place to begin. As your income grows, bump it up a little each year. The important part is getting into the habit now.
Keep It Simple
You don’t need to be a financial expert to plan for retirement. Set up automatic contributions, avoid touching that money, and check in once or twice a year to make sure everything is on track. The goal is consistency, not perfection.
Retirement might seem far away, but the small steps you take today can make a huge difference down the road. Start where you are, use the tools available to you, and remember that your future self deserves the peace of mind that comes from being prepared!
Talk to a Mazuma representative about starting or reviewing your retirement plan.
Consult a tax advisor regarding the deductibility of interest
