Real growth. Compound interest.

The sooner you start saving, the more money you may have for retirement. The momentum you build by starting early allows you to maximize the advantages of compounding interest. Consider setting up automatic transfers to make it easy for you to stay consistent about saving for retirement.

Save now and keep it up

Put the power of compound interest to work for you. Even $1 saved today, instead of 10 years from now, can make a difference to your retirement savings.

At right is an example of two individuals who set aside $200 a month in their workplace 401(k), each earning an average 7% rate of return on investments. The individual who started at age 25 has more than double the retirement savings at age 65! This example assumes no withdrawals or fees which would reduce the return. It is important to remember that investing involves risk, including potential for loss of principal invested.

Starting early allows you to maximize the advantages of compounding interest.

Simple Steps

Get your employer match

Contribute enough to your company 401(k) to take advantage of the typical 2-5% employer match.

Establish a budget

Try the Expense Worksheet to sort out necessary vs. discretionary expenses.

Maintain an emergency fund

It's easy to set up automatic monthly transfers to your savings account. Having sufficient cash reserves helps you avoid dipping into your retirement savings when emergencies occur.

Be smart about debt

Review interest rates carefully, pay off high-interest credit cards first, and make sure you’re not over committing.

Open an IRA

An Individual Retirement Account (IRA) can be a smart option if your employer doesn’t offer a 401(k). Learn more about IRAs


Cornerstones of Retirement

Focus on the cornerstone of asset growth, as you strive to build your retirement fund. Consider enrolling in your workplace retirement plan, if you have one, and contribute the maximum amount your employer will match. Play defense, too—have appropriate insurance coverage and be prepared for life’s unexpected events. Learn about the cornerstones of retirement planning


Saving Strategies

Save early and often to build momentum.

Investing Strategies

Establish an investment plan with an asset allocation strategy.

Retirement Income Strategies

Identify retirement income sources to create your retirement paycheck strategy.


Related Topics

Run the numbers

Estimate what it may take to save for your retirement.

Retirement Calculator


RealSteps>Retirement® Resource Guide

This guide includes information and tools to help you take action and manage your retirement goals.

 

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