Let me start today’s blog with a few questions. Does your current employer offer a 401k or similar retirement program? Do they also offer an employer match? Many do. Now, are you taking full advantage of it?
If your current employer offers you a retirement program, even if they don’t give you a portion as a match, you should be utilizing this wonderful opportunity to save money for the future. The following are the main benefits to employee sponsored retirement options:
1. Matching Money
Not all companies can afford to offer matching monies to their employee’s retirement fund. But, if yours does, you better take advantage of it. Otherwise, you are literally throwing money away. If you are unsure of your company’s program, please visit your human resources department today. Find out the exact percentage they match and at the very least put that same percentage into a 401k or similar account today.
2. Tax Savings
Even if you don’t have the benefit of a company match, retirement saving through your paycheck has the reward of instant tax savings. Always have your employer remove your 401k percentage before taxes. This will actually reduce your annual income reported to the government, entirely legally. Thus you will have fewer taxes to pay at year end.
3. Invisible Money
Do you find that when you have money, you spend it? This is often the case for many people. Saving is tough. Make it easier on yourself and remove your retirement savings from your paycheck upfront, before you even get a chance to spend it.
These three reasons are huge in making a difference in your ability to retire comfortably. In addition, 401k and related retirement programs are greatly expanding their services. Most mid sized and all large companies provide some sort of program as an incredible benefit to their employees. No matter what your age or budget, don’t let this pass you by.
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