Saving for Retirement: Types of Accounts and How To Start


Importance of Saving for Retirement

Saving for retirement, especially for millennials, is not always a priority. Reducing credit card and student loan debt take precedence while future living expenses (30 plus years down the road) take a back seat.

The reality is that one in three Americans report they have no retirement savings, 56 percent of Americans have less than $10,000 saved for retirement and social security benefits aren’t a guarantee. These statistics are staggering, but no matter your age, it’s always a good time to save.

Tips on How to Save for Retirement

 For anyone who has not started saving yet, follow these tips and start planning for your future now.

  • Open an account. Whether it is an employer 401(k), a Roth IRA or a traditional IRA, just open one. Make automatic withdrawal payments to this account monthly and strive to save 10 percent of your gross income.
  • Take advantage of the freebies. Find out if your company offers health savings accounts or flexible savings accounts. These accounts reduce your taxable income and help you save more. Also, take advantage of your company’s 401(k) match. As long as you contribute a certain amount of your pay, your company will match a percentage of it. That’s free money for your retirement.
  • Learn about compound interest. When investing your money, you earn interest and the interest earns interest which is compound interest. This compound interest can really add up over the course of your working years, especially when you start saving in your 20s.
  • Get out of debt. Work on paying off your high-interest debt first and then prioritize your other debts. Once you pay off the high-interest debt, put that payment toward another debt in addition to the amount you’re already paying.
  • Earn more. Earn more money by continuing to increase your knowledge in your field. As you educate yourself through certifications and other specialties, the possibility of promotion increases which could increase your pay and your ability to save.

Types of Retirement Accounts

Your current age, planned retirement age, salary, tax bracket and other factors will help you determine which retirement savings plans are best for you. Educate yourself on your options.


  • Savings plan sponsored by an employer
  • Allows you to save and invest a portion of your paycheck before taxes are taken out
  • Employer often matches a percentage of your contribution
  • Taxes aren’t paid until the money is withdrawn from the account

Roth IRA

  • Individual retirement account
  • Funded with after-tax dollars (money you’ve already paid taxes on)
  • Money grows tax free
  • Don’t have to pay taxes when you withdraw at retirement

Traditional IRA

  • Individual retirement account
  • Tax-deferred – all dividends, interest payments and capital gains compound each year without being hindered by taxes
  • Only pay taxes when you make withdrawals in retirement

Create a Savings Habit

Make saving a habit. Have your employer take regular deductions from your paycheck. If your employer doesn’t have a 401(k) plan, treat saving like a bill that you have to pay each month. You won’t even realize the money is gone by putting it into a long-term savings account. It is never too late to start saving.

If you need assistance as you build your financial future, Centris can help you take the first step. Stop by one of our 14 branches and speak with a service representative or read more about our savings products here.

<a href="" target="_self">Liz Nowaczyk</a>

Liz Nowaczyk


You May Also Like

How to Save Money When You Think You Can’t

How to Save Money When You Think You Can’t

Saving is an important aspect of financial wellness. Yet, it may seem like everything you earn goes towards gas, groceries and other needs, leaving nothing left over for an emergency fund or other financial goals. You might have started going through your...

Budgeting Tips for the Holidays: 4 Tricks to Help You Save

Budgeting Tips for the Holidays: 4 Tricks to Help You Save

The holidays can be a joyful season filled with seeing family and friends, supporting charities, or gifting to those we care about. However, it is common for people to overlook the importance of having a smart spending plan for the holiday season. Without a holiday...