Saving for retirement can be an intimidating endeavor. RCU provides tools and advice to make it simpler.
401(k) and 403(b) An employer-sponsored retirement savings program can often be the most effective way of saving for retirement. Contributions typically can be made pre-tax dollars into your account, which lowers taxable income and therefore the amount of tax due in future years. Furthermore, many employers will match contributions. Alternatively, new eligible federal employees are automatically enrolled in Thrift Savings Plans and receive agency matching contributions of up to three percent of their salary as matching contributions from TSP agencies.
Pension Plan If your employer provides a pension plan, you can rely on it for steady monthly payments after retiring based on how long you worked for the company and your age and total earnings. With these two payment options at your disposal, a lump sum payout or regular annuity payments could provide regular income streams throughout your retirement years.
Individual Retirement Accounts
An IRA (Individual Retirement Accounts) is an individual retirement account that offers you tax advantages that other savings accounts don’t. There are three varieties: Traditional, Roth, and Simplified Employee Pension (SEP). Withdrawals from an IRA don’t incur penalties at any time if accessed prior to age 59 1/2; however you will incur taxes plus an early withdrawal penalty.