You may want to know the information about how to take the first step to your retirement savings plan in Fidelity NetBenefits. Also, you may want to know how to save more cash in your workplace saving plan. Here, there is some information about that so it may help you to find the answer how to do it for your future.
What is a 401 (k)?
First, you need to know what 401(k) is. This is a type of retirement plan which is usually offered through your workplace by your employer. If you get an offer from your employer about this 401(k) plan, you are able to participate for these reasons.
- By participating in 401(k), you will be provided a way to invest for retirement. Besides, it may offer big tax advantages. As an example, in several plans your contribution comes out of your paycheck before income taxes are included which has the meaning that your tax bill will be lower. When you withdraw the money, you may also save on taxes because you may be in a lower tax bracket in retirement.
- You have the chance to get ‘free’ money from your employer in the form of matching contributions.
- Your retirement plan is not just savings which are generic or glorified for your daily expenses, but it is a long term personal plan for growing your savings by investing in a mix of mutual funds, bonds and stocks.
How to Get Started 401(k) in Fidelity NetBenefits?
If you want to enroll to 401(k) in Fidelity NetBenefits, you are able to access the official website of Fidelity NetBenefits at this link https://nb.fidelity.com/public/nb/401k/home/get-started and then click on the Enroll Now. Another way that you can choose to enroll is to call 800-347-2673. When you call this number, you will talk with a representative from Fidelity and get help to enroll in your plan.
If you decide to enroll by accessing the website of Fidelity NetBenefits, after you click on the Enroll Now, then you will be taken to a ‘Verify Your Identity’ page. On this page, you have to enter some based information about your account including your name, date of birth, and last 4 digits of SSN. After that, you have to hit the Submit button.
How to Save More Cash in Your Workplace Savings Plan
It is important for you to know that you control the most important thing, namely how much you contribute to the size of your nest egg. You are able to save whatever you like every year where it is up to the pre-tax contribution limit which is set by the IRS.
The current income that you earn now and monthly budget will be related to how much you are able to save. If you want to save more, there are several things that you have to consider as you are able to see from the explanation below.
- You have to take advantage of your employer contribution if it is offered by your plan. Your employer may match some or all of what you contribute so that it makes this one of the fastest ways to increase your balance.
- You are able to automate your savings. If you decide to set up automatic contributions each month and automatically increase your contributions by 1% or more each year, then these are good ways to save. It is because the money goes directly to your retirement account.
- If your age is 50 or older, you are able to catch up on your contributions. If you decide to save later in life, it can still pay off. You may be able to give a contribution to an additional amount each year depending on the plan that you participate in.
It is important for you to note that if you have high earnings and you have reached the contribution limit, you have to avoid maxing out early. You have to find the information about how your employer contributes to your account and spread out your deferral. So, you will not miss out on employer contributions.
Knowing The Type of Investor
After you save for retirement, you have to make sure that your savings are invested wisely. The key to help protect and grow your savings is to choose the right mix of investments and how to manage them. You have to consider several things such as the amount of experience, time and interest that you have to manage your investments when you decide which approach is right for you.
- A More Hands-off Approach
If you find that it is difficult for you to regularly review your financial situation and investments, you may want to select an investment approach which can work for you as you can see below.
- Single Fund Solution
Usually, there are two types of funds including target date funds which are based on an anticipated retirement date and target allocation funds which are based on a risk tolerance and time horizon. With a target date fund, you choose the fund with the target year nearest to when you want to retire. The fund adjusts the investment mix to be more conservative because it is closer to the retirement date and beyond. With target allocation funds, the investment mix varies from conservative to aggressive. You just have to choose the fund that you feel best meets your risk tolerance, investment goals and time horizon. However, the availability may vary because it depends on your plan.
- Managed Account
If you are offered this option by your plan, investment professionals will know you and your retirement goals and then manage your investments based on your personal situation.
- A More Hands-on Approach
You may be comfortable spending more time researching and monitoring investments and also building your own diversified portfolio and managing it through market ups and downs. If so, Fidelity has tools to be able to help you to a more financially secure retirement.
Well, whatever approach that you choose, you have to make sure that you regularly check that your investment still meets your changing needs at least once a year. It is done to ensure that you are on track to meet your goals.
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