Americans are facing a crisis: They are not saving enough for retirement. Don't become a part of the crowd! Invest in your future.
NursesGeneral NursingArticle
I guess this is more of a public service announcement/reminder...
I was talking to a bunch of coworkers and became deeply disturbed by a certain trend: many Americans are completely ignorant in regards to retirement planning and investing and too many are not saving enough for their golden years. Some fear the stock market and refuse to participate in it, others feel that social security will take care of them (ha ha), while a decent amount stick their heads in the sand.
This post isn't directed to those who are living in destitute and can't afford to save anything. Obviously, not everyone will be able to put forth anything in an IRA or 403b. This is more towards those who are living above their means and/or aren't adequately saving for retirement: don't forget to invest for your future!
Unfortunately, many hospitals and other facilities are cutting back on retirement benefits. Defined benefit pensions are disappearing, and some employers do not contribute anything to their workers' retirement plans at all; my employer has reduced its 403b matching savings for new hires while keeping wages stagnant.
While I realize that some people are scared of the market (and that is completely justified) and find investing confusing, understand that historically, the stock market has always rebounded, with the S&P making average returns of 11%. And with feds keeping the interest rates low, it is even more crucial to involve oneself in the market, less one keeps real estate, wins the lottery or has a rich dead uncle somewhere.
What does this have to do with nursing, you may ask? Everything. Nurses have such a high rate of burnout and on-the-job, career-ending injuries that it is imperative that we save now so that we aren't suffering in our older age.
How to get started in retirement planning?
First, look to make sure that your employer has a retirement benefit. Most healthcare facilities should have a tax-deferred account, also known as a 401k or 403b (for the non-profit sector), available. In 2021, anyone under the age of 50 can contribute $19,500 of pre-tax dollars, with people over the age of 50 being able to contribute an additional $6,500 per year. A 403b gives an advantage to workers by allowing them to save taxes upfront, letting their money grow, and then withdrawing the money presumably at a time when their tax liability is lower. Also, depending on certain circumstances, contributing to your 403b may not change you take-home pay. Awesome? I think so! When choosing investments, however, make sure you diversify (never put your eggs in one basket!) and check your 401k/403b expense ratios, as fees can erode your returns.
Don't have access to a 403b?
NO EXCUSE. Low-fee brokerage companies offer individual retirement accounts, also known as IRAs. The max is lower (5500 for those under and 6500 for those over 50), but both the Roth and Traditional offer tax perks to those looking to invest in their future. Taxable accounts, though not as advantageous as Roth or Traditional accounts, also provide avenues for those looking to participate in the market.
And don't feel as though investing is an all-or-nothing. Most people who participate in their company program cannot afford to or don't max out their accounts and still manage to save enough to meet their post-work needs. The key is to start early, save often and be consistent. Start by getting enough to capture your employer's match (if they offer one)...NEVER leave "free" money on the table! Once you have an emergency of six or so months of living expenses and have all high-interest debt paid off, work up to at least saving 15% of your income, the percent that many financial experts agree will help you exit the workforce at the traditional retirement age...more if you started later and maybe less if you started saving early.
Above all else, just save. The sooner you start, the more your money can compound and work for you!
