Available through CUSO Financial Services, L.P.
Retirement is something you work towards your entire life. Early on, it may seem to be far into the future, but one day you realize it’s around the corner. No matter where you are on your retirement path, it’s essential to know what tools are available to find the plan that works for you.
Employer-Sponsored Retirement Plans
Many employers offer a retirement account benefit—like a pension or 401(k)—that employees can easily contribute to through paycheck deductions. Employers may also provide employee contribution matching up to a specific dollar or percentage amount. Employer matching is a valuable benefit because you are essentially getting free money for your retirement. However, there are some limitations with employer-sponsored plans you should be aware of, including available investment options and little or no access to an advisor to help tailor your portfolio to fit your needs.
Individual Retirement Accounts (IRA)
IRAs are another option to consider. The main difference between an IRA and an employer-sponsored plan is control. With an IRA, you have the flexibility to choose more options, so it’s customized to meet your needs. Investing in a retirement plan with CFS* Financial Advisor Monaye Nelson-Morgan means you’ll have an experienced financial advisor to help guide you through the benefits and make sure you’re on track to reach your financial goals.
Stating “the earlier you start, the more you’ll have saved for retirement” may seem obvious, but it isn’t stressed enough. Let’s compare the difference ten years could make using the Dave Ramsey Smart Investor calculator. In the scenario below, a person who started saving for retirement at age 30 would need to contribute about $200 monthly to have a retirement savings of $200,000 by the time they reached 60. However, if you started at 40, you would need to save $435 monthly to get to that same threshold.
|Start Age||Annual Contribution||Investment Rate of Return||Retirement Age||Potential Yield at Retirement†|
|30 years old||$2,400||6.00%||60 years old||$200,903|
|40 years old||$5,220||6.00%||60 years old||$200,987|
Time makes all the difference. CFS* Financial Advisor Monaye Nelson-Morgan recommends planning for retirement as soon as you start earning income. “It’s never too early [to plan for retirement], but you can definitely start too late.”
Making a Retirement Plan
There are many factors to consider when planning for retirement, including your goals, time until retirement, the market, and your risk comfort level. Some individuals will use their employer retirement plan to maximize employer matching and work with a financial consultant to invest additional retirement funds into an IRA or other investment vehicle. “Investing is not a one size fits all as each person’s situation is different,” Nelson explains. Do what works for you to meet your financial goals.
To learn more about retirement options, check out this Achieve Financial Success playlist. If you’re ready, our CFS* Financial Advisor, Monaye Nelson-Morgan, can guide you through your decision process and help you develop a plan to reach your financial goals. To get started, contact Monaye at (858) 530-4495 or email@example.com.
*Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. The Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members.
†Calculations are for illustrative purposes only and do not reflect the performance of any specific investment.