Plan for your retirement with regular savings that take advantage of deferred taxes and employer contributions, states CNN Money. You need to ensure that the returns beat inflation and avoid touching your retirement funds until your actually retire, advises the Department of Labor.Continue Reading
Start saving early and aim for 70 to 90 percent of pre-retirement income to ensure a financially independent retirement, states the Department of Labor. You need to understand the various types of retirement savings available in order choose the best options, according to the IRS. A 401(k) account offers great returns as the employer matches your contribution and the growth in savings is tax deferred, points out CNN Money.
Even young adults in their twenties should start saving for retirement if they have started working full time, suggests BankRate. This allows for a person to benefit from the advantage of compounding. When estimating the income needed for retirement, the SSA asks that you take into account retirement age, life expectancy, medical coverage and social security benefits. Planning for retirement also requires you to diversify your portfolio and ensure that the returns on your investment are greater than the inflation rate. This typically involves at least some investment in stocks.Learn more about Financial Planning