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    Want to start a retirement plan

    I will be 31 in a couple months and I have no 401k or any other type of retirement account. I'm wanting to start a roth ira but I know nothing about them. Where should I go to open one? Is it a good idea for me? I am married with 2 kids. My wife has a 401k through her job but I'm not sure how much she's putting into it since we have direct deposit and hardly look at pay stubs. I work for a small company and they say they offer 401k I have yet to be given all the information I need to get started (been with them 5 years now).

    Opinions?

    #2
    Welcome to SA. I'm happy you've decided to develop a retirement plan. It's very important to get started. Does your employer offer any type of retirement plan? Do they offer any type of contribution? The sum you can contribute for a year is based on your gross income. Does your wife's employer offer any type of contribution? This is important because it's free money. It's helpful to know what she is holding in her retirement account and how much it costs her in management fees.

    The 2nd step would be to check out your risk tolerance. There are so many [free] on-line questionnaires that figures this out for you. All retirement plans have some element of risk as the stock and bond markets go up and down like a rollercoaster. Since saving accounts only pay 1% or so interest, that doesn't keep up with inflation...you are losing buying power!

    Before you make decisions about a specific plan, I suggest you make a basic list of your fixed expenses like mortgage/rent, utilities [heat,electric,water,trash, cable/internet, phones], transportation [vehicle loans, insurance, operation, maintenance], Credit card balance/monthly payment, Food [home & restaurant], Insurance, childcare + anything you pay regularly. It really helps to start from a picture of your financial health.

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      #3
      Originally posted by robsleeps View Post
      I will be 31 in a couple months and I have no 401k or any other type of retirement account. I'm wanting to start a roth ira but I know nothing about them. Where should I go to open one? Is it a good idea for me? I am married with 2 kids. My wife has a 401k through her job but I'm not sure how much she's putting into it since we have direct deposit and hardly look at pay stubs. I work for a small company and they say they offer 401k I have yet to be given all the information I need to get started (been with them 5 years now).

      Opinions?
      I agree that you need to get your budget on track first. While you get your household in order, take these steps.

      1. Figure out how much you are putting into your wife's 401k and ensure you are meeting the company match.

      2. Figure out how much your company matches and contribute that much to your 401k. (I wish my company offered a 401k).

      ROTHs are easy but do those steps first, then come back and ask about the ROTH.

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