Employees need to develop better saving habits when it comes to retirement, navigating past obstacles such as changing jobs and accumulating too much debt, according to a recent article in “USA Today”.
Those in the Generation X and Generation Y age groups are likely to change jobs frequently over the course of their career, according to research by Hewitt Associates, and when they do are more likely to cash out their retirement accounts. The downside of this approach is that employees pay taxes and penalty fees on that money. In addition, that money doesn’t undergo compounding (interest earning interest), which could have earned a larger balance down the road.
The article also discusses the avoidance of accumulating too much debt. Generation X and Generation Y employees surveyed by Fidelity Investments found that 51 percent of them said that debt-related items, such as credit cards and mortgage payments, prevented them from saving for retirement.
NADART can assist you in figuring out better saving strategies for retirement. To learn more about our retirement plans and the services offered through them, please contact one of our representatives at (800) 462-3278, ext. 7161 or by e-mail at nadart401k@nada.org. You can also request details via our online Product Information Request Form.