A thirty-something’s retirement planning journey

March 03, 2015 by Lisa Masciovecchio
Retired couple relaxing on a boat

I have a confession to make: I’m thirty, single and have about a hundred dollars in my savings account. In addition, I have no retirement plan! That’s not to say I don’t have an idea regarding how I’d like to retire, simply that I have nothing invested to help me fulfill my golden-age dreams. I also know that I’m not alone. Between paying for college, keeping a roof over our heads and ideally having more to eat than Top Ramen, finding something extra to put  away for later is hard.

Whilst I’m confessing, I should note that I don’t know how exactly to save for retirement either. I know there are resources out there. A multitude of websites are dedicated to the topic. I’ve gotten both solicited (and unsolicited) advice from people I know, all telling me the ‘best’ way to make my retirement dreams come true. Soon to be a year older, I’m resolving to move saving for retirement from the ‘Not Even Done’ list, onto the ‘Totally Achieved’ list. To get this done I’ve decided to:


  • Talk to an expert
  • Compare my options
  • Make it happen

Not a long list, I know, but the biggest hurdle (deciding to get serious about it) is done; the rest couldn’t possibly be so difficult, or could it? I started by searching the net; I typed in ‘Retirement’ and received over two million results instantly! Suddenly, my can-do spirit was becoming more than a little can’t-do instead. Offers from financial institutions, articles from major news outlets and websites dedicated to retirement planning flooded my screen and boggled my mind.

Then an article in USA Today caught my eye. It broke down some great ideas on getting started for retirement planning based on age range; sadly, the tips for twenty-something’s were mostly beyond my ability, and a lot of the advice for people in their thirties felt like stuff I knew already but simply needed to take action on. Feeling a bit overwhelmed, I decided I needed to talk it out. I talked to family, friends and co-workers, but still felt unsure on how I should proceed. With so many people at different points in their lives, I was struggling to relate to any of them. It seemed like getting their retirement plans started had been as easy as rolling a tiny bouncy ball down the sidewalk , yet here I was, trying to move a boulder the size of Colorado up a hill all by myself.

There was one constant thread throughout all of my research, though, that sounded promising, and that was the term “Roth IRA.” “What is a Roth IRA?” I wondered. I had no clue, and again went to the net, thankfully getting a less hefty amount of results this time. A Roth IRA looked very appealing at face value; who doesn’t like the phrases “Tax Break” and “Penalty Free”? RothIRA.com describes a Roth IRA as an individual retirement account that offers tax-free income for your retirement.

At the mention of taxes I perked up (working at TaxAudit.com will do that to a girl). I was curious. Would the money I’d contribute really be tax-free and, if so, what exactly did that mean to my future when I needed it? What did this mean specifically to me and my current finances? Did my employer have something that could help me? It was time to talk to a pro (something we’ve got plenty of at the office), so I asked around to see who might be the right person to speak to. I got two answers, our Controller and our VP of Customer Advocacy, a tax wiz.

I found out that we have both a traditional 401(k) and a Roth 401(k) at the company; these employer-sponsored accounts are similar to traditional and Roth IRAs with regard to the tax benefits they offer. The plans allow for higher contribution amounts, and there are no income limitations as there are with IRAs. I set up a time to speak with our Controller, who will get me the documents needed to sign up and also give me more info on my options and the pros and cons of each.

Suddenly, I was excited. I realized I was on my way to a better financial future.

 

*Check back soon for more on Lisa’s retirement planning journey!*

 

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Real estate closing costs can be pesky things. And since you are paying for them, can you at least deduct them from your taxes?
Tax Deduction written on a sticky-note
Tax deductions and credits serve the same purpose − to reduce the amount of a taxpayer's tax owed. The way that each serves this purpose is different.
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In 2019 self-employed taxpayers can deduct their car expenses at the standard rate of 54.5 cents per mile driven for business. However, most employees cannot.
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Millions of individuals and business owners in America currently have unpaid IRS tax liabilities. Here are a few items to consider for tax debt relief options.
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