Retirement planning
Planning for retirement is an ongoing journey and we're here to help you feel prepared every step of the way.
Guidelines for saving
Maximize your 401(k) employer match
If your employer offers a retirement plan, make it your first priority take advantage of the entire match—it's basically "free" money. Companies that offer such plans typically match your contribution dollar-for-dollar or 50 cents on the dollar, up to a certain percentage of your contribution.
Check to see whether you're currently contributing enough to get the full match and if you're not, consider adjusting your contribution amount to get that "free" money.
Aim to save 15% per year
Our rule of thumb is to try to save 15% of your pre-tax income for retirement. That includes your contributions to workplace plans and any additional IRAs, in addition to any matching or profit-sharing contributions from an employer.
Starting early, saving consistently, and investing wisely is important, as is saving in tax-advantaged retirement savings accounts such as 401(k)s, 403(b)s, Health Savings Accounts (HSAs), or IRAs. If you're not yet able to save the full 15%, don't worry—just try to make small cuts in everyday spending. Even saving an additional 1% more has the potential to add up.
Automate your contributions
One of the easiest and most popular ways to make saving a regular habit is to set up automatic contributions. We recommend that you set up automated contributions to your retirement accounts that are timed with your paycheck, so you never have to think about it.
Automatic contributions make sure you prioritize retirement and spread investment risk over time.
What's your retirement score?
Know where you stand for retirement by answering some brief questions. You'll find out if you are on the right track to meet your goals and what steps you should consider as you build your savings.
How to grow your savings beyond the 401(k)
Putting money away every day—that's the first step. Let's make the next step as easy as possible: deciding where to stash your savings. Here's a guide for a few places to put your hard-earned dollars, whatever your situation, to help you prepare for a long, happy future.
Take advantage of IRA savings
In 2021, you can contribute up to:
$6,000 if you're under age 50
$7,000 if you're age 50 or older
Traditional IRAs offer up-front tax breaks, if you meet certain income eligibility requirements.2 Earnings can grow tax-deferred, but you pay taxes on withdrawals and required minimum distributions (RMDs). RMDs are required at age 72.3 Roth IRA contributions are after tax but earnings and withdrawals are free from federal tax, provided certain conditions are met.4
Saving without a workplace account
No 401(k)? No problem. Freelancers, entrepreneurs, and small-business owners still have tax-advantaged ways to save. Alternatives to the traditional 401(k) include SEP IRA, SIMPLE IRA, HSA, or Self-Employed 401(k). You'll need to decide what you value most: maximizing contributions or ease of administration.
Making your old accounts work harder
You've got 4 basic options for an old workplace account: Keep it with your old employer, roll over the money into an IRA, roll over into a new employer's plan, or cash out. Learn about rollover IRAs and other choices for your old 401(k) when you retire or change jobs. Be sure to consider all your available options and the applicable fees and features of each before moving your retirement assets.