Securing your financial well-being is one of the most important things in life.
Contribute to your employer-sponsored retirement savings plan to help begin building a secure financial future.
There are many steps you can take to put yourself on a sound retirement savings footing. Increasing your contributions on a regular basis — say, during open enrollment, on your job anniversary date, the New Year, or your birthday — is a great and often painless way to increase your savings and could make a big difference at retirement time.
If you take any of these steps periodically, you may enjoy a significant boost to your account value by the time you retire. It doesn't take a lot to start saving. And every dollar may make a difference in the long run.
Now! When it comes to saving for retirement, time is your best friend. Over time, your money benefits from compounding — where you can earn interest on your interest. If you haven't begun saving through your employer's retirement savings plan, it's wise to start right away.
The power of compounding can be impressive, but it takes time for it to do its work. If you wait, you may miss a great opportunity and have to make much larger annual contributions later to help reach your retirement savings goal. Don’t procrastinate! See how starting early impacts how much more you can save for the future.
When it comes to retirement planning, we all know what saving is — putting your money away. But just as important is how to put your savings to work for you. Successful investing requires setting goals, evaluating the choices available, as well as understanding and managing risks. Learn the basics about mutual funds, stocks, bonds, asset allocation, and diversification.
After you've decided how much to contribute to your retirement savings plan, you need to choose where those dollars will be invested — this process is called asset allocation. Investors typically diversify by allocating certain percentages of their accounts to one or more of the three major asset classes: stocks, bonds, and cash equivalents. Each asset class has its own risk and return characteristics. Also, each asset class has a benchmark index, which tracks a particular group of funds that are representative of a market, as a way of measuring that market's performance.
The idea behind diversification is that each type of funding option has strengths and weaknesses in various market situations. By spreading your money among various types of investments and asset classes, you take advantage of their respective strengths without exposing all of your plan account to an investment in one concentrated area. While diversification through an asset allocation strategy is a useful technique that can help to manage overall portfolio risk and volatility, there is no certainty or assurance that a diversified portfolio will enhance overall return or outperform one that is not diversified.
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Any discussion of taxes is for general informational purposes only, does not purport to be complete or cover every situation, and should not be construed as legal, tax or accounting advice. Clients should confer with their own qualified legal, tax and accounting advisors as appropriate.