Why Gen Y Should Save Now For Retirement
You’re finally on your own and out of your parents’ nest, so the last thing on your mind is retirement. If you’re like most young adults, you might want to spend your money on a few iTunes songs, gourmet coffee and tickets for your favorite college or NFL, NBA, NHL, MLB and MLS teams.
While having a social life is great, it would be even greater to have a solid financial future. The earlier you start saving for retirement, the more money you’ll have to keep living the lifestyle you’ll be accustomed to.
Here are a few reasons you should start now to invest in your retirement plan:
- Employer Match Benefit or Profit-Sharing – Many companies offer to match a certain percentage of an employee’s contributions or contribute an amount from an employee profit-sharing or similar plan.
- Pre-tax money – If you decide to start a 401k plan, contributions come directly from your paycheck into your retirement account. It continues to grow tax-free until you start making withdrawals.
- Compound interest – Your investments will grow over time because you’ll have a longer time to compound. In other words, a 22-year-old who saves $100 per month will have more value than a 42-year-old starting to save at twice the rate.
- Personal control – You have personal control over how much is contributed and when to stop saving or start saving more.
- Availability – If you change jobs, you have the option to move your retirement account to an IRA or roll it over to a new employer's retirement plan tax-free.
Do you know how much your retirement can grow over the years? Calculate your contribution by using this retirement plan savings calculator.
Go to GEICO’s retirement planning calculators to help you plan and invest for your future.
The above is meant as general information and as general policy descriptions to help you understand the different types of coverages. These descriptions do not refer to any specific contract of insurance and they do not modify any definitions expressly stated in any contracts of insurance. We encourage you to speak to your insurance representative and to read your policy contract to fully understand your coverages.