It is never too early to start saving. As college graduates become young professionals and enter the workforce, developing savvy saving habits early on can set the foundation for a better retirement.
Below are a few simple tips for young professionals:
- Contribute to your 401(K): Don’t wait to save. Many companies offer retirement savings vehicles such as a 401(k). If your employer does offer a retirement savings plan, take advantage by contributing as much as possible. Also, if your employer is willing to match your contributions up to a certain percent, try to save enough to maximize their matching. Check out our Retirement Income & 401(k) Calculator to see how saving even a small percentage each month can accumulate.
- Create a Budget: Do you feel you do not have enough to save? Creating a budget that takes into account minimal savings will not only start you on the path to a better retirement, but will also help you control your everyday spending. Sit down and determine your fixed and variable expenses and use a simple budget worksheet like this one from personal finance expert, Ellie Kay.
- Begin Developing a Balanced Portfolio: Make sure your retirement portfolio includes savings vehicles that balance the amount of risk and reward. As you advance in your career, set some money aside in a reliable retirement product such as a Fixed Indexed Annuity to continue to protect your retirement. With FIAs, your money has the ability to grow risk-free; your principal is protected and will never decline in value.
For young professionals, retirement can feel like a lifetime away, but the financial decisions that are made in your early career can determine what your retirement will look like 30 or 40 years in the future.
Use our retirement calculators to see how much your retirement could cost and why you should start planning today!