401(k) Not Offered

Planning for Your Financial Future on Your Own

If your company doesn’t offer a retirement plan like a 401(k), you're not alone. In fact, according to the U.S. Bureau of Labor Statistics, you're among 55% of all workers who don’t have access to a defined contribution plan.1

Don’t let this discourage you. There are still many ways you can save for your retirement. Consider these options.

Get a head start

If you're not putting money into some type of long-term investment vehicle, then you're risking your future. It will be hard for you to keep pace with your current standard of living in retirement if you don’t do something about it now. Keep in mind that investing involves market risk, including possible loss of principal.

The sooner you invest, the more opportunity your money has to work for you. There are things you can do now to help make sure you have the money you need later.

Ask your employer to consider starting a retirement plan

Tell them how important a retirement plan is to you. If they're not convinced, find out how many other employees would like to have this important benefit. If all else fails, remind your employer that a retirement plan may help attract new employees to your company, and there are tax benefits for the business as well.

Compare job offers

The next time you interview, carefully compare your job offers. Ask about all available benefits, including a retirement plan like a 401(k) and the employer match. Calculate the value, in dollars, of the potential employer match. If you're not offered one, consider negotiating a higher salary to make up for the loss.

Think about an individual retirement account

There are two types of individual retirement accounts, or IRAs, you can consider in this case: a traditional IRA and a Roth IRA. Both have advantages and disadvantages.

With a traditional IRA, your contributions are tax-deductible now. Withdrawals are taxed as ordinary income and if taken prior to age 59½ they may be subject to a 10% penalty. You can contribute to a traditional IRA until age 70½, and there are no income limitations.

Having a Roth IRA means you'll have to pay taxes on contributions now and you won't be able to deduct these contributions - but any earnings grow tax-free. And with the Roth, there is no limit to how long you can contribute.