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There are so many individual details to take into consideration when beginning retirement savings planning that it can be easy to make small mistakes that could affect your overall success in planning for a comfortable retirement. Here are a few things that will help to avoid those little mistakes when sitting down to plan out your retirement savings strategy.
It’s never too early to begin saving for retirement
There are several benefits to beginning a retirement savings plan in your 20’s as opposed to waiting until your 30s. For example, a retirement savings account started at the age of 25 will earn exponentially more compound interest over the span of a 40-year career than waiting to start saving at the age of 35. Another benefit of starting your retirement planning early is that it is easier financially to begin saving now rather than waiting until after starting a family and/or buying a home. Many employers offer to match retirement contributions up to a certain percentage. By taking advantage of this offer now, instead of later, you will also help to secure a financially comfortable retirement.
Withdrawing funds early is never a good idea
Many people consider their retirement savings as an emergency cash fund instead of its intended purpose, which is to give them financial security after retirement. Withdrawing retirement funds early will cause extra fees and taxes to be charged depending on the amount taken out. It will also be much harder to save the amount needed for a comfortable retirement when having to start over from scratch. Borrowing from a retirement savings account is also to be avoided if at all possible. These loans typically don’t charge any fees or cause taxes to be taken out, but they do usually require repayment within five years and if the loan is not paid back, those penalty fees and taxes are charged at that time.
Tax savings1, convenience, portability. These are just a few of the perks of opening up a Health Savings Account (HSA) at Guaranty Bank & Trust. When an unexpected medical bill rolls in, an HSA can help you deal with the stress.
Account Details:
- Minimum Opening Balance of $50
- Interest-Bearing Account – Daily interest paid on the entire balance.
- Unlimited Check Writing