Whether you're three months - or three decades - away from retirement, our targeted 401(k) checkup will help you make all the right moves.
Retirement isn't even on your radar. You're probably strategizing about retiring your debt instead. On average, 2007 graduates who took out student loans left college owing $20,000, according to the Project on Student Debt. Still, it's crucial to begin saving for retirement early. You should start funding your 401(k), then pay off your high-interest debt like credit card bills.
Nearly half of all twentysomethings with a 401(k) plan turn down free money by not contributing enough to receive the full company match.
Start brown-bagging your lunch so that you can stop leaving cash on the table. For someone making $30,000 a year, setting aside $35 a week is all it takes to sock away 6% of your salary into a 401(k). That's the ceiling for a typical full employer match, which ranges from 50% to 100% of the amount you're saving.
Job-hopping. Many twentysomethings are tempted to pull out their 401(k) savings when switching gigs. "While $5,000 may not seem like a whole lot of money, if invested, that amount will be substantial by the time you retire," says Vanguard retirement research guru Ann Combs.
Bottom line: Downturns are a boon for young investors. Anyone with a long investment horizon can afford to wait for recovery while scooping up stocks and mutual funds on the cheap. So get moving!
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