All
Thought leadership series
Here's where the kids should start investing for retirement once they get their first full time job?
My kid just started working. Where should they put their retirement savings first? For a younger worker in a lower tax bracket, a good starting order may look like this: 1. Roth 401(k) up to the employer match (don't leave free money on the table) 2. Roth IRA, max out if eligible (up to $7,500 in 2026) 3. Max the HSA, if available and eligible. 4. Then go back and add more to the Roth 401(k) if there's still money available for long-term savings. Why fund the Roth IRA before putting every additional dollar into the employe 401k plan? Flexibility. Your Roth IRA contributions can generally be accessed tax- and penalty-free if you ever need them. Money in a current employer's 401(k) is typically much harder to access while you're still working there. That doesn't mean we want your kid dipping into their retirement savings. But especially when they're young and just getting started, having another bucket with some flexibility can be valuable (think buying a first home, going back to school, etc.) If they're already in a higher tax bracket, the strategy may change. Pre-tax 401(k) contributions could become more attractive depending on what their tax rate looks like today versus what you expect it to be in retirement. There isn't one contribution order that's right for everyone’s circumstances but there should be a reason behind where each dollar goes. If you want to review how your kid should be saving as they start their career, click the link in our bio. #RothIRA #Roth401k #RetirementPlanning #HSA #YoungInvestors #FinancialPlanning
Osaic Wealth Form CRS
Securities and investment advisory services are offered through Osaic Wealth, Inc., member FINRA/SIPC and a registered investment advisor. Additional investment advisory services offered through Strategic Financial Advisors Corporation, a registered investment advisor. Strategic Financial Advisors Corporation and Strategic Financial Services Corporation are not affiliated with Osaic Wealth, Inc.
This communication is strictly intended for individuals residing in states where the contracted representative is licensed. No offers may be made or accepted from any resident outside the specific state(s) the representative is registered. Current registered states: AZ, CA, CO, CT, DE, FL, GA, KY, MD, NJ, NM, NY, NC, PA, SC, TN, TX, VA. Please contact us to determine the states in which each representative is registered.
Broadridge Investor Communication Solutions, Inc. does not provide investment, tax, or legal advice. The information presented here is not specific to any individual’s personal circumstances.
To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances. Osaic Wealth, Inc. does not provide tax or legal advice.
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.
PLEASE NOTE: The information being provided is strictly as a courtesy. When you link to any of the websites provided here, you are leaving this website. We make no representation as to the completeness or accuracy of information provided at these websites. The company is not liable for any direct or indirect technical or system issues or any consequences arising out of your access to, or use of third-party technologies, websites, information, and programs made available through this website. When you access one of these websites, you are leaving our website and assume total responsibility and risk for your use of the websites you are linking to.