Set up your 401(k) or IRA
When you start your first full-time job, there are plenty of outlays vying for a piece of your new paycheck. You might have student loans to pay, an emergency fund to save for, and new furniture to buy for your new apartment. You might think it’s impossible, or unnecessary, to set some money aside for retirement now. Let’s be honest — it’s decades away, and you’re just getting started.
But that’s no excuse. You need those decades to build up a retirement income you can actually live on, and the earlier you start, the better off you’ll be. Many employers offer a 401(k), and it’s a great way to get started without having to do too much heavy lifting. A rough real-world estimate of how much you should put aside: at least 10%.
Many employers also match an employee’s 401(k) contributions up to a certain percentage of their salary. If you contribute at or beyond that threshold, you take full advantage of the benefit. But if you contribute less than your employer is willing to match, you may be passing up free money. Unfortunately, many people do miss out. Americans leave billions of dollars in 401(k) company matches on the table each year.
