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6 Retirement Plans Millennials Should Start Thinking About (Or Embrace ASAP)

6 Retirement Plans Millennials Should Start Thinking About (Or Embrace ASAP)

Most millennials are still struggling to pay their student debt, so when you tell them to think about retirement plans, most of them are going to tell you to stop mocking them. The reality is, retirement plans are not a priority for millennials, but they should be. Why? Time flies! And starting to save early in life is going to ensure your retirement years are happy years.

Unfortunately, most millennials are afraid of all those complicated words and the sheer length of tax codes, so they need someone to explain these things in plain English. Well, here are the 6 best retirement plans for millennials explained.

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1. 401(k)

The 401(k) is the most popular plan, and most employers offer it, so you can just make a call to the HR department of your company and ask them to solve the papers for you. The maximum revenue is $18,000 per year, and you can pick how much you want to contribute. The contributions are made before the taxes, which are paid when you will take out the money.

One of the major benefits of a 401(k)[1] is the fact that it enables you to grow your retirement plan fast, but you have to stick to the options your employer picked for you.

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2. Regular IRA

If you have a taxable income, or your spouse has one, you are eligible for IRA.[2] With this plan you can earn $5,000 per year, and the contributions are made before the taxes, just like with the 401(k). You are going to pay the taxes when you take out the money.

Of course, this ensures a high growing rate for your fund. Unlike the 401(k), you can invest your money in investments offered by your bank. The cons come with the taxes: because you pay the taxes when you withdraw money, you might notice your tax bracket is higher when you take out the money, so you will be paying more taxes.

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3. Gold IRA

This is not exactly a retirement plan itself, but more of an option to add to your regular plan. Regular IRA and 401(k) are compatible with gold investments. Gold IRA is exactly what you think: investing your money in gold,[3] because its value grows nice and steady over time.

4. Roth IRA

The Roth IRA is dedicated to singles who earn at least $116,000 per year, or couples who earn less than $180,000 per year together. The best thing about this retirement plan is the fact you won’t pay taxes when you take out the money! The contributions are made after the taxes, and you can earn as much as $5,500 per year. Another nice fact is there is no mandatory withdrawal when you are 70 years old, as it is with the other plans.

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5. SEP IRA

As many millennials are entrepreneurs, or they are on their way to becoming entrepreneurs,[4] here are two retirement plans dedicated to small businesses. The SEP IRA allows you to plan for your retirement along with your employees. The maximum amount is 25% of an employee’s compensation, or $51,000. For the employee this plan comes with free money from the employer, and for the employer it comes with tax deductions for the contributions. This is one of the best retirement plans for the self-employed. The con of this plan is the fact that you will pay taxes at the current tax rate when you start withdrawing.

6. Simple IRA

Another IRA for businesses, with a $12,500 maximum contribution. The contributions are taken from the employees salary, and the employer can contribute to his or her account, or to their employee’s accounts. The employee can decide how much to contribute on this plan, and the contributions are made before the taxes. At withdrawal you also pay the taxes.

With a simple IRA the penalization for withdrawing before 60 years of age can be up to 25%, so make sure you do your calculations right.

Featured photo credit: Unsplash via unsplash.com

Reference

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Last Updated on October 16, 2018

The Ultimate Guide to Help You Sleep Through the Night Tonight

The Ultimate Guide to Help You Sleep Through the Night Tonight

It’s well past midnight and you’ve got to get up in less than six hours. You toss and turn all night. Before you know it, another hour passes by and you start panicking.

If I don’t get to sleep in the next 30 minutes, I’m going to be exhausted tomorrow!”

One thing is for sure, you’re not alone. Over 70M+ Americans have stated that they don’t get the proper sleep they need at night.[1] So what could possibly be causing this insomnia epidemic?

Throughout my entrepreneurial journey of building my language learning company, I have experimented and researched dozens of best sleep practices. Some have flopped but a few have dramatically improved the quality of my life and work.

In this article, I’ll look into the reason why you’re sleep deprived and how to sleep through the night tonight.

Why you can’t sleep through the night

The first step to improving anything is getting to the bottom of the root problem. Different studies have shown the reasons why most people cannot sleep well at night.[2] Here are the main ones that the average person faces:

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Stress

If you’ve ever stayed up at night worrying about something, know that it’s a major sleep inhibitor. When you’re feeling stress, your mind and body becomes more activated, making it incredibly difficult to fall asleep. Even when you do manage to sleep, it won’t be deep enough to help you feel rested the next day.

Exposure to blue light before sleep time

We’re exposed to harmful blue light on a daily basis through the use of our digital screens. If you’ve never heard of blue light, it’s part of the visible light spectrum that suppresses melatonin, our sleep hormones. Other harmful effects include digital eye strains and macular cellular damage.

While daytime exposure to blue light is not very harmful, night time exposure tricks our brain into thinking it’s daytime. By keeping your brain alert and suppressing melatonin, your mind is unable to shut down and relax before bedtime.

Eating close to bedtime

Eating too late can actually be an issue for many people, especially those who are older than 40. The reason is, eating before laying down increases the chances of Gastroesophageal reflux disease (GERD), in which stomach acid backflows into the esophagus.

Another reason not to eat too late is sleep quality. Even if you manage to sleep right after eating, it’s likely that you’ll wake up tired. Instead of letting your body rest during sleep, it has to digest the food that was entered before bedtime.

Rule of thumb: eat 3-4 hours before bedtime.

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Medical conditions

In some cases, it could be medical conditions that cause your sleep problems. If you can’t relate yourself to the above reasons or any of these common sleep problem causes, you should visit the doctor.

The vicious sleep cycle

The biggest danger to repeating the bad habits mentioned above is the negative cycle that it can take you through. A bad night’s sleep can affect not only your energy but your willpower and decision making skills.

Here’s an example of a bad sleep pattern:

You get a bad night’s sleep
–> You feel tired and stressful throughout the day.
–> You compensate it with unhealthy habits (for example junk food, skipping exercises, watching Netflix etc.)
–> You can’t sleep well (again) the next night.

    You can imagine what could happen if this cycle repeats over a longer period of time.

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    How to sleep better (throughout the night)

    To help you break the vicious cycle and stop waking up in the middle of the night, I’ll explain to you a list of actionable steps to solve your trouble staying asleep.

    1. Take control over the last 90 minutes of your night

    What you do (or don’t do) before bedtime have significant impact on the quality of your sleep. Many times, it can be the difference between staying up until 4am and sleeping like a baby.

    Here are a few suggestions:

    • Go from light to dark – Darkness stimulates production of the sleep hormone melatonin. Turn off unused light around the house, and think about investing into warm light that you can use in the bedroom before bedtime.
    • Avoid screens (or wear blue light blocking glasses) – Keep the bedroom a technology-free zone as the light from electronic devices can disturb your sleep. If you need to work, wear blue light blocking glasses (also known as computer glasses) throughout or before you sleep to prevent sleep disruption.
    • Find an activity that helps you to wind down  This could be anything that calms you down, and reduces thinking (especially unnecessary stress). Fir example, listening to soothing/good feel music, taking a hot bath, reading or meditating.
    • Keep any electronics you have on the other side of the room or outside the room – One of the most harmful things that can disrupt your sleep is the notifications you get from your smartphones. The simplest way to avoid this is to keep it away from you.
    • Create a bedtime routine – A night routine is a couple of things you do prior to going to bed. By doing these things every night, you’ll have a more restful and high-quality sleep. Learn how to pick up a night routine here: The Ultimate Night Routine Guide to Sleep Better and Wake Up Productive

    2. Eat the right nutrients (and avoid the wrong ones)

    What you eat (not just when we eat) plays a critical role in your sleep quality. If you’re ever in doubt of what to eat to improve your sleep, take the following into consideration:

    • Kiwi – This green fruit may be the ultimate pre-bed snack. When volunteers ate two kiwis an hour before hitting the hay, they slept almost a full extra hour. Kiwis are full of vitamins C and E, serotonin and folate—all of which may help you snooze.
    • Soy foods – Foods made with soy such as tofu, miso and edamame, are rich in isoflavones. These compounds increase the production of serotonin, a brain chemical that influences the body’s sleep-wake cycle.
    • Fiber-rich foods – Eating more fiber could be key for better sleep. Eating fiber was associated with more restorative slow-wave sleep—the more you eat, the better you sleep—per a study published in the Journal of Clinical Sleep Medicine. Fiber prevents blood sugar surges that may lower melatonin. Get a fiber boost from beans, artichokes, bran cereal and quinoa.
    • Salmon – Most fish, especially salmon, halibut and tuna boost vitamin B6, which is needed to make melatonin— a sleep-inducing hormone triggered by darkness.

    3. Adjust your sleep temperature

    Once you’ve gone through the first 2 recommendations, the last step to experiment with is temperature. According to Sleep.org, the ideal temperature for sleep is 60-67 Farenheit. This may be cooler than what most people are used to, but keep in mind that our body temperature changes once we fall asleep.

    Rule of thumb: sleeping in cooler temperature is better for sleep quality than warmer temperature.

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    Find out how to maintain the optimal temperature to sleep better here: How to Sleep Faster with the Best Temperature

    Sleep better form now on

    Congrats on making it to the end of this guide on sleep. If you’re serious about taking the necessary steps in improving your sleep, remember to take it one step at a time.

    I recommend trying just one of the steps mentioned such as taking a hot bath, blocking out blue light at night, or sleeping in cooler temperature. From there, see how it impacts your sleep quality and you can keep doing what works, and throw away what doesn’t.

    As long as you follow these steps cautiously and diligently, I know you’ll see improved results in your sleep!

    Featured photo credit: pixabay via pixabay.com

    Reference

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