Retirement InvestmentsWhat did you do with your holiday bonus? What did you do with your last raise? Did they fall into the abyss of stuff you don't remember you purchased?
If you have been following our discussion this week, you are already aware that paying debt and establishing an emergency fund are good uses for your money. Saving for your retirement is important too.
The earlier you start a retirement savings the sooner you will start earning interest for your retirement. Starting a retirement account can save taxes immediately, or after retirement.
Roth-IRA, CD, ROI, 529B EFT, mutual fund, spiders -- if you do not know the meaning of all these terms, you are not ready to invest your money. Do your homework. This information is readily available. There are many excellent online resources available to define these and other terms and to focus the user on appropriate investments. Our blog cannot recommend specific investments or appraise your needs or tolerance to risk.
Many nannies have an Individual Retirement Account (IRA). This is a personal retirement savings plan available to anyone who pays taxes. Financial experts recommend opening an IRA as young as possible to allow time for your retirement investments to grow. A traditional IRA allows tax-deductible contributions of up to $4,000 per year, or more if you are over age 50. Whatever you contribute towards your IRA comes off your yearly income, and is non-taxable income.
Right now interest levels are at historical lows. Be aware that at this time, interest rates are every low on savings accounts and certificates of deposit.
A better lifestyle at retirement is just one of many worthwhile goals to have. Putting money aside for a home, a car, or education are other typical goals for saving money.
A well organized personal financial system can save you stress and aggravation while easing tension in personal relationships while increasing your power. Surely you wish you had more time and energy. You may be surprised how arranging your financial affairs will increase your time, save you energy, and relieve tension.
Tomorrow: How to choose charities to donate to and get tax write-offs.
Are you saving for your retirement? If so, how are you saving for your retirement?
It is funny you typically get a bunch of responses and no one commented about IRA's. I do have one but I have a husband and he has one from work and convinced me to open one for me since I am a nanny with no 401K like people that work for corporations.
ReplyDeleteI think it is fair to say single, young nannies aren't going to have IRAs. Although your advice is completly right and important. Young singles tend to let their dads and jobs think that far into the future.
Nanny Annie
Germantown, TN