Pay for the Past, Save for the Future

You may struggle with whether it's better to pay down debt or save for retirement. How can you decide?

Making decisions about what to do with money you don't need for basic living expenses can be complicated. You may struggle with whether it's better to pay down debt or save for retirement. How can you decide?

It's important to your overall financial security not to have a mountain of debt. But there is also a good case to be made for investing the money, or at least some of it, for your future.

Each person's situation is different, and you'll need to weigh a variety of factors:

How much debt do you have?
What kind of debt is it?
What interest rate are you paying on the debt?
Does your employer offer a retirement plan with matching contributions?

Secure Your Future

It's important to start saving as soon as possible, because once you've passed up a chance to contribute to a tax-advantaged retirement plan, you can't get it back. Every year, you're allowed to contribute only so much to an employer-sponsored retirement plan and to a traditional or Roth IRA. Once the deadline passes for each tax year, your opportunity goes with it.

Many employers that offer a 401(k) or similar retirement plan also offer matching contributions. If you don't contribute at least enough money to your retirement plan to earn the full matching contribution, you turn down free money. Worse yet, that money and your missing contribution can't grow tax-deferred over the long term.

As the saying goes, time is of the essence. Don't put off saving for retirement, because you probably can't afford to lose the advantage of long-term compounding.

You’re not in this alone. Visit a local branch to speak with a knowledgeable representative.

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Pay for the Past, Save for the Future

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