When it comes to retirement savings, where should I begin?

By taking full advantage of your workplace-based retirement savings plan, you can meet the challenge of building a stronger financial future with confidence. Here’s a guide to help new retirement savers get started:

Step 1: Decide How Much You’ll Contribute to Your Retirement Plan

The short answer is, contribute as much as you can to your retirement plan.1 Find an amount you’re comfortable with.2 If you contribute on a before-tax basis, you may find that your contributions don’t take as big a bite out of your paycheck as you might have thought.

Step 2: Decide How to Invest Your Plan Contributions

Where should you start?
The more you learn about investing and the options available in your plan, the better equipped you’ll be to make informed choices.3 Start by determining your “investor style,” or comfort level with risk. To learn more, read Managing Risk in Your Retirement Plan Account.

What kinds of investments are best?
There are really no investments that are "best" for anyone. Your investment choices should be based on your investor style, age, number of years until retirement, your investment objectives and your long-term retirement income goals. Incorporating asset allocation and diversification4 into your investment strategy can help you weather the market’s ups and downs along the way. For more information, read Choosing Your Retirement Plan Investments.

Step 3: Join Your Retirement Plan

You can't begin to save for retirement until you actually enroll in your retirement plan. It's fast and easy. To learn how, call 1-877-PRU-2100 or contact your plan administrator.

Step 4: Increase Your Contributions Regularly

Be sure to increase your contribution amount regularly—at least once a year. You may want to select the same time each year—such as your birthday, anniversary, or when you receive a performance review. Boosting your contributions on a regular basis can go a long way toward helping you achieve greater long-term financial security.

1 If your plan allows you to make contributions. Contribution amounts are subject to plan provisions and IRS limitations. Contact your plan administrator for more information.

Withdrawals (other than qualified Roth withdrawals) are subject to income taxes and potentially a 10% federal income tax penalty if taken before age 59 ½ (457 Plans not subject to 10% penalty).

2The maximum amount you may contribute to your plan account depends on your type of retirement plan, your age and, potentially, other factors. Contact your plan administrator for more information.

3You may not be able to choose the investment options for all of your account’s contributions. Your plan may require that some contribution types, such as employer-matching contributions, be invested in a certain way (such as in employer stock), as outlined in your plan documents.

4Keep in mind that application of asset allocation and diversification concepts does not assure a profit or protect against loss in a declining market. It is possible to lose money by investing in securities.

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Ed. 09/2011