Saving for retirement can be stressful for anyone, but as a traveling nurse it may be more challenging since your income can be higher, your overhead lower and you may be working for more than one agency. Balancing retirement funds, insurance costs and overhead against saving for retirement, all while traveling can make the process difficult. Setting retirement goals is important since you likely do not want to be a travel nurse forever and it’s crucial to start planning sooner rather than later.
Just as with purchasing real estate there is one crucial key factor – location – when you are planning for retirement your crucial factor is consistency. With a steady plan of funding your retirement investments, you may be surprised how much you can accumulate and how quickly. For instance, if you begin contributing $50 a paycheck when you’re 25 years old your retirement balance could easily be worth a quarter of a million dollars or more. Increase that contribution by just $10 and the balance is over $330,000. The numbers assume a conservative 7% rate of return. With a higher rate of return, greater contribution on your part and 401K from your employer, you can easily be ready to retire at 65.
Before you jump into any 401k plan as a retirement savings vehicle from your agency, it’s important to take a hard look at what they mean for you and your specific situation. Many travel nurses may find a traditional IRA is a smarter choice than a 401k as they provide a hassle-free and effective way to manage your retirement account regardless of whether you move agencies or not. For instance, some firms offer a 401k and will match your contribution dollar-for-dollar after you have become vested in the company. If the agency has a two-year vesting period, you’ll forfeit the match if you move agencies before 2 years.
It’s really never too late to start saving for your retirement years. It is important to be disciplined and to ask questions. Many find the financial arena uncomfortable and so it’s important to surround yourself with trusted professionals who are financially savvy and interested in protecting your interests.
Take advantage of technology to help you keep track of your money and set up automatic deposits for savings. These also allow you to transfer between accounts and keep track of your overall return on investment.
There are a variety of types of accounts, such as a 401k, 401a, 403b and Roth IRA. This can all get very confusing, quickly. But, it really doesn’t have to be when you can find a financial advisor who will be straightforward with you. Seek out large investment firms with good track records whose counselors are not paid on how much you invest with them. Get an explanation for each of the different types of retirement accounts you could use and decide for yourself whether paying taxes now is better than paying taxes later and how solid you may feel about the travel agency you’re working with in order to take advantage of their 401K match.
At Amare Medical Staffing we are sincerely interested in your future and your future retirement. We will work with you to help find the best assignments possible for your skill-set and continue to work with you in the coming years. Contact one of our professional recruiters today and check out what you may have been missing.