Saving for retirement Start as soon as you can The following steps may help you maximize your retirement savings:   Start saving as soon as you can: If you start contributing to a retirement fund early in your working life, you may generate more retirement income than if you wait. In fact, if you regularly contribute to your account for 20 to 30 years, compounding on your contributions will likely make up a larger portion of your total savings than actual dollars contributed. Save as much as you can: At the very least, try to contribute enough to your company retirement plan to receive the maximum match your company may provide. If possible, contribute enough to your retirement plan to reach the maximum tax-deferred contribution allowed by the Internal Revenue Service ($15,500—plus catch-up contributions if over age 50—for 2008), you'll be better off in the long run. Set goals: Think about the lifestyle you want in retirement and set goals to achieve it. Stick with it: Investing a little every month uninterrupted for the long haul may pay dividends in compound growth. Starting early can pay off in the golden years The chart below illustrates how starting early can pay off. In this hypothetical example, Joe and Jill started working for the same company in the same year, earning the same beginning salary of $25,000, with annual increases of 4%. Jill started a savings program immediately, putting away 5% of her salary annually with no interruptions, earning an annual return of 8%. This hypothetical example is for illustrative purposes only and is not intended to reflect the return of any acutal investment. Investments do not typically grow at an even rate of return and may experience negative growth. After 30 years, Jill would amass $230,150. Joe decided to wait to start a savings program. If he saved 11% of his salary annually for the last 10 years before retiring, earning an annual return of 8%, he would accumulate $114,832. Although contributing more than double the monthly amount, Joe would miss out on the returns created by the compounding process over the first 20 years. Fund objectives, risks, charges, and expenses should be carefully considered before investing. A prospectus containing this and other important information can be obtained by calling (866) 676-7680 or by visiting this page on russell.com. Please read the prospectus carefully before investing. Copyright © Russell Investments 2005. All rights reserved. This material is proprietary and may not be reproduced, transferred, or distributed in any form without prior written permission from Russell Investments. It is delivered on an as is basis without warranty. Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide, including Russell Investments, and is a subsidiary of The Northwestern Mutual Life Insurance Company. Nothing contained in this material is intended to constitute legal, tax, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this publication should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional. Securities products and services offered through Russell Financial Services, Inc. (formerly Russell Fund Distributors, Inc.), member FINRA, part of Russell Investments. For information on the Financial Industry Regulatory Authority, go to www.finra.org. First used: May 2008 RFD 08-0239			Simplify your investment decisions by choosing one diverse LifePoints fund.     RELATED Articles The High Cost of Borrowing from Your Retirement Understanding Compounding Developing Your Investment Strategy Tax Strategies Planning for Retirement Checklist Printer friendly version of this page Send feedback or comments Site Search

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