It’s never too early to start planning for retirement. In fact, the sooner you start saving, the more time your money will have to grow. Unfortunately, there are so many types of retirement savings accounts available that it can be hard to know which is best for you. To help make your decision easier, Bill Schantz shares an overview of the most common retirement savings account options and what they can do for you.
Bill Schantz Explains Retirement Savings Accounts
Retirement savings accounts are investment accounts that allow you to save money for retirement. The money you save in these accounts is invested in various assets, such as stocks, bonds, and mutual funds, which can help it grow over time.
According to Bill Schantz, several types of retirement savings accounts are available, each with its own set of features and benefits. Some of the most common types include 401(k) plans, individual retirement Accounts (IRAs), and Roth IRAs.
Each type of retirement savings account has its own rules and restrictions, so be sure to read up on the specific account before deciding which one is right for you. For example, 401(k) plans require you to make regular contributions from your paycheck, while IRAs allow you to contribute any amount you want on a monthly or annual basis.
Ultimately, the best retirement savings account for you will depend on your individual needs and preferences. So take your time and do your research before making a decision.
Bill Schantz Highlights Types of Accounts
As Bill Schantz stated above, there are many options when it comes to retirement savings accounts. Let us look at a few of them
The first option is a traditional 401(k) or IRA. These retirement plans offer tax advantages and allow you to contribute pre-tax earnings towards your retirement goals. Traditional 401(k)s and IRAs have higher contribution limits than other types of accounts, making them attractive for those wanting to save for their future. Additionally, these accounts usually come with employer matching programs, meaning if your employer matches part of your contributions, you get to reap the benefits of free money.
Another popular retirement savings vehicle is a Roth IRA. These accounts differ from traditional 401(k)s and IRAs in that contributions are made with after-tax money, and you do not get a tax benefit when making your contribution. However, qualified withdrawals from these accounts are tax-free, meaning you won’t have to pay any taxes on the money you withdraw at retirement age. Therefore, while you don’t get an immediate tax break up front with a Roth IRA, it can be beneficial in the long run if your income changes over time.
Finally, self-employed people may want to consider a SEP-IRA. This type of account is specifically for self-employed individuals and allows them to contribute up to 25% of their net earnings annually. Like a traditional 401(k), this is an employer-sponsored account, meaning the employer can make contributions on behalf of the employee.
These are just a few of the retirement savings options available. To find out more about your retirement savings options and decide which is best for you, speak with a financial advisor who can help you create a personalized plan for your retirement goals.
Bill Schantz’s Final Thoughts
According to Bill Schantz, Understanding your retirement savings options is key when planning for your future. The earlier you start saving, the better off you will be down the road. It is important to research your options and find the account that best suits you, as each type of account has different features and benefits. With the right retirement savings plan in place, you can ensure that you are properly prepared for retirement.