Saving tips

Last updated: 7/20/2009 12:19:36 PM

Don’t delay—start today

Contribute as much as you can to your savings plans as early as possible. That way, your savings have a longer time to benefit from potential investment growth—and you enhance your ability to reach your retirement goal.

Pay down your debt

More debt means less money available to save and invest for your future. When you are working toward long-term financial security, it’s important not to take on more debt than you can comfortably manage.

Contribute regularly

Payroll deducted contributions through Trust Advantage not only help build your savings but also make it more affordable because you are budgeting for smaller, regular amounts.

Diversify your investments

You’ve heard the old saying, “Don’t put all your eggs in one basket.” This is the basic idea behind diversification. Putting your money in different types of investments can help you achieve a more consistent long-term performance than you would likely achieve if you put all your money in a single type of investment. In theory, when certain types of investments are declining in value, other types are gaining value.

Review your plan

Changes in personal circumstances can have a big impact on how much you need to save and how you invest. Reviewing your plan regularly will help identify what you need to do to stay on track.

Maximize tax-advantaged savings

As a public school employee, you can contribute to a tax-sheltered annuity (TSA) on a pre-tax and/or after-tax (Roth) basis if your schools district plan allows. Before-tax savings offer a unique opportunity to reduce taxable income now and, at the same time, increase your savings for the future. You pay no taxes on your savings—or earnings—until you take your money out. Roth contributions are taxed now, but qualified withdrawals, including earnings, are tax-free. When you retire, you will owe nothing on years of compounded earnings, which may be a significant amount.

An IRA is also a great way to save for your future and take advantage of potential tax benefits. There are two IRA options available—the Traditional and the Roth. Consider the unique characteristics of each to determine which best fits your needs.

Get help

Consult with a financial advisor who can evaluate your personal situation objectively and advise you about what’s best for you!

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