When it comes to retirement, time can be one of your greatest assets. The earlier you begin investing, the more opportunity your money has to grow. But if you’ve never invested before, knowing where to begin can feel intimidating. Whether you’re in your 20s or your 50s, it’s never too early—or too late—to start building your retirement future.
In this guide, we’ll walk you through the basics of how to start investing for retirement, the types of accounts to consider, and how to make informed decisions along the way.
Understand Your Retirement Goals
Before you dive into investments, it’s important to understand what you’re working toward. Retirement goals look different for everyone. Some want to travel the world, others want to stay close to home and spend time with family. Understanding your vision for retirement will help determine how much you need to save and how aggressively you need to invest as will your risk tolerance and capacity.
Start by asking yourself these five questions:
- At what age do I hope to retire?
- What kind of lifestyle do I want to maintain?
- Do I anticipate any major expenses, like travel or large purchases?
- How much money should I account for future healthcare needs?
- Will I have other sources of income, like a pension or rental property?
Once you have a general idea, you can begin estimating your financial needs and choosing the investment approach that makes the most sense for you and your situation.
Evaluating Retirement Accounts
Retirement accounts offer varying characteristics and potential tax advantages that can help your money grow more efficiently over time.
Here’s a quick comparison of the most common retirement accounts:
| Account Type | Tax Advantage | Base Contribution Limits* (2025) |
| 401(k) | Tax-deferred growth | $23,500 (plus $7,500 catch-up if 50+) |
| Roth 401(k) | Tax-free growth | $23,500 (plus $7,500 catch-up if 50+) |
| Traditional IRA | Tax-deferred growth | $7,000 (plus $1,000 catch-up if 50+) |
| Roth IRA | Tax-free growth | $7,000 (plus $1,000 catch-up if 50+) |
* Additional contribution limitations may apply based on income or cumulative contributions. Potential tax penalties for early withdrawals and investment loss risks should also be considered.
Each account has its benefits, and in many cases, using a combination of them can be a smart strategy. For example, contributing to both a 401(k) and a Roth IRA (if eligible) can provide you with flexibility in how your withdrawals are taxed in retirement. These accounts are subject to eligibility rules and investment risks. Consult a tax professional or advisor for personalized advice.
Steps to Start Investing for Retirement
Once you’ve opened your retirement account, or accounts, it’s time to put your money to work. Here’s how to get started:
- Start with what you can afford: Don’t wait until you can max out your contributions. Even small, consistent contributions can grow over time.
- Take advantage of employer matches: If your employer offers a 401(k) match, contribute at least enough to get the full match.
- Choose diversified investments: A mix of stocks, bonds, and other assets can help reduce risk and increase potential returns.
- Consider target-date funds: These automatically adjust your investment mix as you approach retirement.
- Review and rebalance annually: Markets change and rebalancing can help offset risk as it does. Make sure your accounts are being rebalanced, if appropriate, so your investments have a better potential to stay aligned with your risk tolerance levels and long-term goals.
- Increase contributions over time: As your income grows, aim to increase your retirement contributions. Even a 1% bump each year can make a difference.
Investing doesn’t have to be complicated. Consistency and time in the market are often more important than picking the “perfect” stock or fund.
Common Mistakes to Avoid
It’s easy to make missteps when you’re first starting out in your investment journey but knowing what to watch for can help you avoid setbacks. Here are some of the most common investing mistakes people make:
- Waiting too long to start: Time is critical. Delaying even a few years can significantly reduce your future savings.
- Not taking enough risk early on: Younger investors may invest more aggressively than older investors1. Playing it too safe may limit your growth.
- Ignoring fees: Investment fees can eat into your returns over time. Pay attention to expense ratios and advisory fees.
- Cashing out early: Withdrawing funds before retirement often comes with penalties and missed growth opportunities.
- Trying to time the market: It’s incredibly difficult to predict the future—even for financial professionals. A steady, long-term approach can offer a smoother path to helping you work toward your financial goals.
Starting your retirement journey may feel overwhelming, but you don’t have to do it alone. At Vantage Point Financial, we help individuals and families take the first step toward retirement with personalized investment strategies, education, and ongoing support.
Whether you’re just getting started or want to make the most of your current plan, we’re here to guide you with clarity and support. Contact us today to build your roadmap that will seek to help you live retirement boldly and on your terms.
Citations:
Yahoo Finance, April 1, 2022
Investment advisory services are offered through Vantage Point Financial, a registered investment adviser. Registration with any regulatory body does not imply any particular level of skill. This material is provided for informational purposes only and should not be construed as investment, tax, or legal advice. Working with a financial planner does not ensure financial success or prevent loss. All investments involve risk, including the possible loss of principal. Past performance does not guarantee future results. The scenarios presented are hypothetical and are intended for illustrative purposes only. They do not reflect actual client results and are not guarantees of future outcomes. Individual results will vary. Certain financial strategies may offer tax advantages, but outcomes depend on individual circumstances and are subject to change due to tax laws and other external factors. Vantage Point Financial does not provide legal or tax advice. Consult a tax professional. Retirement outcomes depend on a variety of factors, including individual savings behavior, market performance, health events, and other considerations. Certain statements herein may reflect the firm’s current views, expectations, or beliefs, which are subject to change without notice. For additional information about our services, fees, and disclosures, please refer to our Form ADV Part 2A, available at https://vantage-point.mwdevsite.com or upon request at no cost.
