To help you get started, the Department of Labor, the Department of Education and the NAACP Financial Freedom Center are presenting a free webcast for college seniors and young workers on Feb. 28 from 1 to 2 p.m. EST. The webcast, held during America Saves Week, will cover:
- making the most of employer-provided benefits
- options for student loan borrowing and repayment
- managing debt and credit
It’s important to be well-informed and to get on the right path as early as possible. One way to do this is to sign up for your employer’s retirement plan as soon as you start a new job. Resist the impulse to stick the retirement plan information in a drawer to be read another day. Starting to save now can pay off big later.
Consider this example…
Jennifer puts $1,000 into savings every year from age 20 to age 30, contributing a total of $11,000. She stops, but she doesn’t spend it – she leaves it there. Michael starts at age 30 and saves $1,000 a year until he is 64, contributing a total of $35,000. But Jennifer’s account is worth more than Michael’s at age 65, even though she put in a lot less.
Why? Jennifer started earlier and compound interest has longer to make her money grow.
Want another reason to start saving in a retirement plan? Employer matching contributions. About half of all employers with 401(k) plans match some portion of your contribution. But to get that free money, you have to sign up and contribute.
Need more convincing? Take a look at our Savings Fitness guide and find other valuable information available at www.dol.gov/ebsa. And don’t forget to sign up here for our webcast on Feb. 28 to learn how to take charge of your financial future!
Phyllis Borzi is the assistant secretary of labor for employee benefits security.