It's never too early — or too late — to start saving for retirement. We've got some timeless tips for growing your nest egg.
Whether you've just started your first job or you're already retired, now is a great time to think about your retirement finances.
The best advice for retirement is to start as early as possible — preferably with your very first job. The power of compound interest is on your side, and you can save significantly more money in the end, just by starting a few years earlier.
Make sure you're saving enough by using a retirement calculator. If you're starting to save in your 20s, many experts recommend you save 10-20 percent of your gross income. That can feel like a lot, so don't be afraid to start with a smaller number and work you way up one percent at a time over the years.
If your employer offers a match, you'll definitely want to put enough in their sponsored plan to make that free money. After that, though, shop around and find the best account for you. You may find that an IRA is more flexible and fits your goals better than your employer's plan.
If you're nearing retirement, take a look at your finances and decide what's realistic. If you have plenty of savings and you live a frugal lifestyle, then you may even be ready to retire today. But, if you're hoping to travel the world in a yacht and don't have the funds to back that up, working for a few more years — and saving diligently — is a better plan for you.
Retirement savings can be complicated. Don't be afraid to ask someone who knows the ins and outs of the field. At Bank of Arkansas, our financial planners can help. We have specialists who focus on Retirement Planning, and they can help you make the most out of your savings, no matter where you are in your retirement journey.
Even though retirement may seem far in the future, there's no time like the present to start thinking about it. When coming up with a plan for your retirement savings, ask yourself these questions:
Most financial professionals suggest that you have three to six months of living expenses in your cash reserve. However, the actual amount should be based on your particular circumstances.
A tax-deferred custodial account or trust used to save for retirement. Up to $5,000 per year can be contributed to an IRA, although people 50 and older can contribute up to $6,000 annually. Earnings are tax-deferred until withdrawal of funds, beginning at age 59½. Withdrawals at retirement age are fully taxable. Early withdrawals are allowed but carry a 10-percent tax penalty.
At Bank of Arkansas, we're here to help you explore different options for retirement planning.Request Information