Saving for the future is important as it provides cover and financial safety for uncertainties in the future. There are many tools and ways to save for the future. This article provides some of Andrew Kyriacou’s tips for saving for the future which are as follows:
Open an Individual Retirement Account (IRA)
An IRA is an account opened by a financial institution which allows the account holder to save for retirement with tax-free growth or tax-deferred option. There are two basic types of IRA- traditional and Roth which offer immediate tax savings or tax-free withdrawals when the money is needed by the individual after retirement. The money in the IRA grows in a tax-deferred basis. The IRA helps the money compound faster, thereby creating a corpus for retirement. The government also promotes IRA by incentivizing the low and middle-income group through means of tax credit, known as the savers credit. Individuals can seek help and guidance from experts like Andrew Kyriacou’s tips which can prove helpful in planning for future savings.
Become a Part of 401(k) Plan
The 401 (k) plan is an employer-promoted and sponsored retirement plan. It provides the individuals with an option of putting the money in the plan which compounds on a tax-deferred basis, to create a retirement corpus in the long-run. Employers provide matching contributions to the 401(k) plan to the employees who opt for this plan. This is an added incentive for the employees to participate in the 401(k) plan and save for the future.
Health Savings Account (HSA)
The HSAs are meant to create savings which may be needed for meeting health expenses in the future. Healthcare is becoming costly and it can wipe out major chunk of the future savings for individuals. Hence the HSA seems a good initiative to save as it allows the users to contribute money on pre-tax basis and withdraw the money in future on a tax-free basis, provided the money has to be used only towards health care expenses.
Saving for Children- 529 Plan Accounts
The 529 plans basically help individuals save for their children’s education and college expenses. It allows the individuals to make contributions in a tax-deferred account. The distribution of the eligible expenses is tax-free under this plan. Some specific states also provide additional incentives for making contributions to the 529 account.
Long-Term Stock Investing
Individuals can open a regular brokerage account for long-term stock investing. The longer the investment horizon, the greater will be the returns. However, individuals should seek professional consultation and advisory services before investing in stocks. Expert resources like Andrew Kyriacou’s tips can prove helpful for this.
Read more about Andrew Kyriacou