A Millennial’s Brief Guide to Retirement Planning

The past couple of years have been tough economically, especially for young professionals—a.k.a. millennials in their 20s and 30s— who have been hit hard with student loan burdens, housing expenses, rising costs of healthcare, and more. According to the National Institute of Retirement Security, about 66 percent of people between the ages of 21 and 32 have absolutely nothing saved for retirement. As the economy keeps recovering, millennials need to start finding a way to increase their savings and planning for their future. We at The Bachmann-Zeitlin Insurance Agency, the leaders in retirement planning in Chester County, PA, strive to provide the guidance and support you need to give you confidence in your retirement strategy.

1. Save for retirement now.
Unfortunately, millennials are largely on the hook for financing their own retirements and may have to work longer to supplement their savings. Most experts don’t expect millennials to be living the same kind of lifestyle in retirement as their grandparents. The earlier you start saving will lead to more money you will ultimately have when it comes time to kick back in retirement. Your future should be a priority.

2. Consider your options.
Retirement accounts such as IRAs and 401(k)s are a terrific way to boost savings. Currently, there is the traditional IRA account, Roth IRA, and 401(k). The primary difference between both IRAs and the 401(k)s has to do with contribution limits. Workers under 50 can contribute up to $5,500 annually to an IRA and up to $18,500 in a 401(k).

Millennials considering opening an IRA should inquire about Roth IRAs. Roth IRAs are an individual retirement account that lets an investor save up to a certain amount of after-tax dollars every year. The earnings in the account grow tax-free, and distributions taken after age 59½ are exempt from taxes. Roth IRAs also provide investors with flexibility, allowing the investor to withdraw funds without early withdrawal penalties or ordinary income taxes.

Additionally, you can check to see if you qualify for your company’s 401(k). If you are eligible to have a plan sponsored by your employer, we encourage learning your company’s match formula/percentage. Some companies contribute 100 percent (dollar for dollar) up to five percent, some contribute 50 percent (50 cents for every dollar) up to seven percent.

3. Visit a financial planner.
Visiting a financial planner will help you better outline your goals and determine the best strategy for your lifestyle and financial aspirations, no matter your age. The expert’s goal is for you to have the comfortable, enjoyable retirement you’ve dreamed of, and they’ll do everything in their power to make that happen.

Millennials are still young and new in their careers and have the time to develop positive saving and investing habits. By scheduling an appointment to meet with one of our retirement planning professionals in Bucks County, PA, you are choosing to take a step towards a comfortable retirement and a bright future with a company who will help reach your goals. The Bachmann-Zeitlin Insurance Agency will help secure the retirement you always wanted!