401K IRA
It is vital that we plan for our future retirement. No one wants to work until they die or be forced to rely on their loved ones to support them financially.
There are lots of different retirement plans that people use to avoid that. The two we will descuss now are IRA and 401K.
IRA 401K Most all employers offer a 401K fund as part of their package of benefits. They will also often offer incentives for you to contribute to that fund. One popular way of doing that is to match every dollar you contribute for so many years or to a certain total per year. They do this for a couple reasons.
The law requires employers to maintain so many dollars for the benefits they grant employees. This is in hopes of avoiding more cases like Enron had. When they are encouraging the workers to contribute to the fund, they get more dollars to back their package up.
Too, they will usually take the funds and invest in either in-house business or market funds. This generates earnings from the money you the worker has contributed. So when you retire they get to pay you back with mostly your money or the earnings from your own money.
An IRA is an Individual Retirement Account. This is an account created by the government to encourage people to start investing for their own retirement rather than relying completely on the 401k plan their company offers or the Social Security system. By encouraging us to plan for our retirement, they ease the strain on the Social Security.
Since their are so many types of IRA's, it may be difficult to decide which is the best for your plan. Discuss your retirement goals with a financial advisor and they can help you see which is the right one.
There are lots of different retirement plans that people use to avoid that. The two we will descuss now are IRA and 401K.
IRA 401K Most all employers offer a 401K fund as part of their package of benefits. They will also often offer incentives for you to contribute to that fund. One popular way of doing that is to match every dollar you contribute for so many years or to a certain total per year. They do this for a couple reasons.
The law requires employers to maintain so many dollars for the benefits they grant employees. This is in hopes of avoiding more cases like Enron had. When they are encouraging the workers to contribute to the fund, they get more dollars to back their package up.
Too, they will usually take the funds and invest in either in-house business or market funds. This generates earnings from the money you the worker has contributed. So when you retire they get to pay you back with mostly your money or the earnings from your own money.
An IRA is an Individual Retirement Account. This is an account created by the government to encourage people to start investing for their own retirement rather than relying completely on the 401k plan their company offers or the Social Security system. By encouraging us to plan for our retirement, they ease the strain on the Social Security.
Since their are so many types of IRA's, it may be difficult to decide which is the best for your plan. Discuss your retirement goals with a financial advisor and they can help you see which is the right one.
posted by Credit Counseling at
1:38 PM
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