If you are young and at the start of your career, retirement may not be one of your primary concerns. However, it’s never too early to start planning. With time on your side, you can build a healthy retirement egg and enjoy life during your Golden Years!
Take Advantage of Your Company’s Retirement Plan
Most employers offer retirement savings plans that allow you to invest part of your salary before it’s taxed. This makes investing easy and automatic because the money is diverted before it ever reaches you.
Moreover, many companies offer matching contributions up to a certain percentage of your income. So, for example, if you invest 3% of your salary, your firm will give you an additional 3%, and if you invest 4% of your salary, your firm will give you an additional 4%, and so on.
If your company offers this type of arrangement, it’s prudent to invest the maximum amount they are willing to match because you are essentially receiving free money from your employer. By taking advantage of these matching funds, your investment account will grow twice as fast.
Open Your Own IRA
If you’re self-employed or doing freelance work, you probably don’t have the option of a company retirement plan. However, don’t let this stop you from planning and investing in your future because most individuals are allowed to open up an individual retirement account on their own. Again, the earlier you start investing in one of these funds, the longer your money will have to grow. Also, you’ll have the law of compounding on your side. In other words, as your investment generates income, you can turn around and invest that money for even greater returns. If you decide to invest in an IRA, you can choose between two main types. A traditional IRA allows you to contribute pre-tax dollars, but your gains are taxed when you take out the money; a Roth IRA allows you to invest money that has already been taxed, but that investment is then allowed to grow without ever being taxed again.
If you are young when you start investing, a Roth IRA is generally considered the better option. You’ll have many years for the money to grow, and all gains will be tax-free. It’s also worth noting that while investing in either type of IRA is fairly straightforward, you should check the yearly contribution limits to ensure you are complying with the government rules and regulations.
Invest in Cryptocurrency
Since most of your portfolio will be in U.S. dollars, why not add some balance by also investing in cryptocurrency? Many believe cryptocurrency provides protection against inflation and the centralized banking system.
Trading and storing cryptocurrency is also more accessible than ever before. For example, you can buy, sell, trade, and hold a variety of cryptocurrencies on the OKX exchange, including Bitcoin, Ethereum, OKB, Litecoin, and Dogecoin. Having everything on one exchange makes it simple to manage and oversee your investments.
Don’t wait until you are near retirement age to plan for your Golden Years. Instead, get a headstart by investing today. With the proper planning and strategy, you can increase your net worth and build a solid financial foundation to support and protect yourself and your loved ones later in life.