Saving for retirement is the easiest thing in the world: if you work for a company that has a retirement plan. If you don’t, you still have to save. It just isn’t quite as easy. But it is not hard.

The absolute next best, simplest thing is to start an IRA or a Roth IRA. Remembering that our target audience for Save10 is women 18-30, advice on this is going to be with that target in mind. 

I am going to assume that like most ladies in your 20s, you are likely not making much money yet. That is why you probably want to start a Roth IRA. Basically, if you aren’t making much money, then you aren’t paying much in taxes. With a Roth, you tell the federal government that you will save money into a Roth IRA, and you go ahead and pay taxes on the dollars you deposited. BUT, your deal with the government is you will never pay taxes again on that money. So it gets to grow over time, and you rest assured knowing that every dollar growing is 100% yours.

The other account is an IRA. The deal with the federal government there is you will not pay taxes on the money you deposit into the IRA. This, in theory, allows you to stretch your dollar further, to save more than you would otherwise. So you start with a larger pile of money, and that money gets to grow over time, but when you take it out you will have to pay income taxes on the entire amount.

Let’s say you make $30,000 per year doing a couple jobs, and you want to Save10. Well, 10% of $30,000 is $3,000 per year. The best thing to do is to open a Roth IRA with a financial institution (like Vanguard, Fidelity, or Schwab). Then elect to have $250 per month (or $3000/12) auto drafted into that account and auto invested. At Save10 we cannot give investment advice, but do not fear! Those places can help you find the right mutual funds for your age, most likely guiding you to a target date retirement fund.

Like magic, something so seemingly daunting is now so simple. 

Remember, if you have high interest credit card debt, that might make sense to go ahead and pay down before you save. Check out our blog on that!