The best thing to kick off your 2019 is to create a financial plan – especially for your future retirement. Here’s a few recommendations from The Balance:
If you want to retire with the same standard of living in your golden years, it is important to studiously save for retirement. Consistently putting away at least 10% to 15% of your income every payday should put you on track to a great retirement.
The best type of retirement plan for a large number of Americans is the 401(k) plan. This type of retirement plan is named for its section of the IRS code that explains how it all works. Most importantly, you should understand your investment options, how your retirement plan influences your taxes, and how to get the biggest impact from every dollar of retirement savings.
Depending on your employer, you may or may not have access to this type of retirement plan. Many education workers rely on a 403(b) plan, which has similar rules. Public employees of government agencies typically have a 457 plan in addition to a pension. But 401(k) plans are the biggest and most common employer-sponsored retirement plan.
If you are a small business owner, an HR manager evaluating 401(k) providers, or an in-demand worker comparing multiple job offers, it helps to understand the criteria that make a retirement plan the best retirement plan.
When looking at 401(k) plans, try to find one that minimizes fees while maximizing investment choices across diverse, low-fee mutual funds and/or ETFs that align with your needs. For this reason, some of the biggest investment brokerages and mutual fund providers set the standard for the best retirement plans available today. And the difference between expensive plans and low-cost plans can easily lead to tens of thousands of dollars in your retirement, if not more. A recent study found the average fee is around 1% of assets, but high-quality plans charge significantly less.
It’s also important to consider employer matching. This is up to your employer, not the plan provider, but it’s an incredibly valuable piece of the total compensation puzzle and you’ll want to keep it in mind. Many large employers match around 3% to 6% of an employees gross pay.
Now that you know more about what to look for in a 401(k) plan, which is very similar to a 403(b) or 457 plan for education and government workers respectively, here is a list of the best retirement plan providers you can choose today.
Continue reading HERE.