A new study by Clever Real Estate shows the average American is not saving enough for retirement and 37% are not saving at all.
The survey of a thousand people goes on to report that only one in three current retirees have enough in retirement savings and that 75% carry debt.
Danetha Doe with Clever Real Estate said if your employer offers a 401(k), sign up and if your company offers a match, put enough of your paycheck aside to get it.
“Matching is when your employer will match the amount of money that you are also putting into your retirement account. So, it’s essentially free money,” Doe explained. “If you have access to that as an employee, definitely take advantage of that.”
Doe also encouraged people to take advantage of Health Savings Accounts or HSA plans. She said these accounts offer a “triple” tax advantage because you are not taxed on the money going into the account or the earnings you accrue. It’s also tax free when you pull the money out when you are ready to retire.
If you are 50 or older, the IRS allows tax-free “catch-up” contributions over regular limits on certain accounts.
If you are under 50, or just starting to save for retirement, USA.gov has a great overview of the basics of retirement planning. The Department of Labor also has a reference guide for the top 10 ways to plan for retirement.
