Retirement options for every stage of life

Saving for retirement is one of the most important things you’ll ever do. Yet many of us don’t start until we are approaching retirement. Here are some options for saving at each stage of your life.

Young Adult

As a young adult, you face a unique set of challenges, often including student loan debt, the need to save up for a house, and other major financial burdens… all while trying to start your career and actually earn money.

Here, you should be aiming to put 10% to 20% of your income into a long-term investment plan. An index fund (which matches the top of the stock market) is a fairly reliable way to do this, and doesn’t have the hassle of trying to predict which stocks will rise. Avoid risk and just focus on building up your savings.

Consider using a Roth IRA (or a similar setup), which allows your future withdrawals to be tax-free. This won’t matter to you much right now, but it will make a huge difference later in your life.

Middle Age

By now you should have an established career and a relatively steady amount of income. At this point, you should start talking with a financial advisor and looking for ways to grow the money you’ve put into your retirement account over the last decade or two.

You may be confronted by advertisements that try to scare you into investing in high-risk ventures (often so you don’t have a “bad retirement”). Avoid these, and instead, continue to put around 20% of your income towards your retirement savings.

Don’t forget to ask your place of employment about any retirement plans or pensions they offer, and see if those will be better for you than your current plans.

Close to Retirement

By this point in your life, you should have a large amount in savings, and you can tolerate a little more risk. The ultimate goal is to generate enough income from your savings to entirely live off of. Don’t forget to consider additional income like Social Security, and it’s all right to invest a small part of your savings in moderately-risky ventures that could pay off.

If you haven’t started saving yet, speak to a financial advisor about options that are not overly risky, but will still net you some significant gain by retirement.

No matter what stage of life you are in, talk to a financial advisor about your goals. We can create the perfect plan for you.