For most young workers, planning for retirement typically isn’t a priority. But as the nation’s fiscal outlook darkens, the likelihood that Congress will scale back Social Security benefits in the coming years only grows. Without early planning, most simply won’t be able to maintain the standard of living they expect in retirement. 

Whether you want to educate your young employees about planning for retirement or ensure a secure future for your child, here are four tips to help you reinforce the importance of retirement planning and inspire them to act.

Give Them 3 Irresistible Options

Workers hired straight out of college often are unsure about retirement planning because they are unaware of their options. They don’t know how to start or how much to save. If you help them know their investment options and find the approach that works best for them, they will surely consider the idea of contributing.

• A 401(k) Plan. The 401(k) plan is the most favored investment option for most workers because it needs little effort and the matching contribution from the employer—viewed as free money—is attractive.
• A Roth IRA. While Roth IRA plans are not employer-sponsored, they make an excellent addition to a traditional 401(k) plan. The best part about investing in a Roth IRA is that the contributions are made on an after-tax basis. This means that all the withdrawals made during retirement after age 59½ are tax free.
• Profit-sharing plans. This type of defined contribution plan isn’t an option for many, but where it’s available it enables employers to contribute cash or company stock to tax-deferred retirement accounts for employees. The plans are popular among the employees of young entrepreneurs and startup founders. They not only motivate team members to invest in employee stock options but also inspire them to actively contribute to company success.

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