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Retirement Savings Options for Young Workers

Posted by Corey F. Schechter | Oct 18, 2016 | 0 Comments

Retirement 20egg

As business owners, retiring comfortably is certainly a goal in addition to working to build and protect company assets. Saving for retirement should also be a priority for employees, and employers can assist in providing them the means to do so. For young workers, thinking about retirement savings generally falls pretty low on the list of financial priorities. Most workers in their 20s are busy trying to first cover their health care premiums, car payments, rent, and paying off student loans. At the end of the month, they may not have much to put aside for something that seems so far off in the future. However, planning for retirement now will help build a healthy nest egg for the future. Knowing there is a path to saving enough money to retire comfortably not only decreases an employee's overall stress but can increase their productivity at work.

If a 25-year-old worker puts away $100 a month until they retire at 65, at a 6% annualized return, they will have over $185,000. If they wait 10 years and start saving at age 35, the same plan will earn them only about only about half that, or less than $95,000. By starting early, retirement savings will grow faster over time.

From an employee's perspective, a 401(k) with an employer matching contribution is one of the best options for all workers. For employees who do not participate in this type of plan, it is like passing up free money. Thus, employees are encouraged to contribute enough to gain the maximum employer contribution.

A 401(k) is a convenient way for employees to save for retirement. Employee contributions can be automatically withheld from their paycheck based on a set amount or percentage. These are generally treated as pre-tax contributions, so the money grows tax-free until it is distributed.

Helping employees save now will put them in a better position to retire in the future. Unfortunately, too many retirees rely solely on Social Security as their source of income and don't realize that those benefits alone will not provide them the means to retire comfortably until it is too late.

If you have any questions about providing retirement benefits for your employees, contact Butterfield Schechter LLP. We are San Diego County's largest firm focusing its law practice primarily on employee benefit legal services.

At Butterfield Schechter LLP, we will make sure your benefit plan is in compliance with the latest changes in employee benefits law. Our firm can help you establish a custom benefits plan that conforms with regulatory requirements and represents not only your best interests but those of your employees. Contact our office today with any questions on how we can help you and your business succeed while providing for a comfortable retirement for you and your employees.

About the Author

Corey F. Schechter

Corey Schechter practices in the areas of Employee Benefits, Employee Stock Ownership Plans, Pension and Profit Sharing Plans, ERISA, ERISA Litigation, Business Law, Qualified Domestic Relations Orders (QDROs), and Employment and Labor Law.


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Retirement Plans

We help establish a customized plan that meets regulatory requirements as a tax qualified plan. Following implementation, our attorneys can assist clients and their plan administrator with regular reviews and updates to help with regulatory compliance for the plan's operation, and continued effectiveness in meeting the client's specific goals.


We are dedicated to employee ownership. When you come to us for ESOP services, you receive influential legal counsel who stand beside you to help you stay informed, in compliance, and abreast of the latest developments-all to help you realize your plan goals as fully and effectively as possible.


A QDRO is a specially designed court order that is required for the division of retirement benefits in a family law case. Many family law attorneys do not possess the expertise necessary to divide retirement benefits or stock options upon divorce. We have extensive experience in dividing qualified plans, government plans, IRAs and stock options between the employee spouse and non-employee spouse.

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