401k,IRA?I have more info

Thanks Clyde
I have more info...Im 48 in March, cant decide on company 401k or an IRA
I really just want to do one or the other, I dont understand doing both, and want to know which to choose. I make less than $40,000 annually and actually use every penny of it to live. I hope to still be working here for the next 20 years and need to start saving now. This company 401k pays 25% on my contribution of any amount not to exceed $15,000 per year. so if I contribute $1.00, they contribute $.25. Thats all I can find out about that. I have no knowlege of IRAs yet. A roth one, a deductible one is all I know. I feel kinda dumb, but more frightened. I hope you can help me out a little bit.

401k is better because you get an instant 25% gain on every dollar invested.

I would look to start with a 401k contribution of 10% (company match gives you 2.5% more) and slowly increase this as you get raises (get a 3% raise, up 401k 2%- your take home still increases and 401k increased by 2.5% (2% from you and .5% from the match).

Pamy,

Thanks for the additional information.

I agree with Jim_Ohio's recommendation. That is step one in my earlier post. If you think you can not afford the 10% recommended, do less. With your contribution being tax deferred you will see very little change in your take home pay.

Once you are signed up for the 401k, your contributions will be automatic. Contributing to the 401k plan and receiving an extra 25% is a good boost to your retirement savings.