by Chelsea Springli 
Preparing for retirement in your 20s and 30s, can mean a future of financial freedom. Consider these helpful tips when you’re planning for your retirement.
Start saving.
If your employer offers a 401(k), take advantage of it. If you don’t have the benefit of a 401(k), that’s ok. The credit union has products to help you start saving for retirement. You can open your own Individual Retirement Account (IRA) with Alltru and start planning for your future. My husband and I each are fortunate to have a 401(k) that we contribute to through our employers. We also set aside some extra money each paycheck into a long-term Certificate of Deposit (CD). This allows us multiple options when it comes to saving for retirement.
Automatic transfers.
While saving early is important, so is the habit of doing so automatically on a continuing basis. We use automatic paycheck deductions to transfer money to our 401(k)s and CD. This helps avoid the hassle of trying to remember to transfer money each time and making sure we are set for our future. We set a goal to save at least 10 percent of our gross income, which we felt was a good start. You can do this too, and increase it as your income changes. All Alltru we have a High Yield Online Savings account so you can earn an even better yield on your money.
Take advantage of free money.
Find out if your employer offers to match your 401(k) contributions. If so, they are giving you money for retirement, so take advantage of it. A 401(k) match typically requires you to contribute a certain amount of your base pay up to a pre-set limit, and the company will match your contribution with funds of their own. My husband and I both feel lucky to work for employers that offer this as a benefit. It allows us to contribute a good amount to our retirement fund while earning free money. That was a no-brainer for us.
Don’t let a better job derail you.
If you change jobs, don’t let your retirement fund take a hit. Too often, workers opt to cash out a 401(k) from their previous employer. If you do cash out before age 59-1/2, you’ll pay a 10 percent penalty on top of income taxes, which could be as much as 37 percent if you’re a high earner. The smart move is to roll over the 401(k) into an IRA, which you can then invest any way you want.
Use your resources.
It’s incredibly important that you understand what is happening with your money. Putting that much money away every month can be nerve-wracking and cause some stress on your monthly budget. Ask questions of your accountant, financial planner, or simply make an appointment to talk to an expert at Alltru. Knowledge is power. There are no stupid questions.
Until next time,
Chelsea Springli
