How to jump-start your 401(K) in your 20s

If you're in your 20s and just got your first job working in Atlanta, saving for retirement with a 401K is probably the last thing on your mind. Instead, if you are like most millenials, you are no doubt more busy paying for a place to live, eating out every night, and keeping your wifi and smartphone turned on.

Although it may seem unrealistic to throw a retirement plan into the mix when you have all those other expenses, the reality is that the earlier you start planning for your retirement, the sooner you can begin to enjoy your golden years without the burdens of financial stress. Below are some ideas that can jump-start your 401(K) and help get you on the right track.

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Sign up for your employer's 401(K) plan.

A 401(K) plan is a type of retirement plan offered by many employers. It allows employees to save for their retirement by having money deducted from their paychecks and put directly into a retirement account. Most workers like this type of plan because the money comes directly out of their paycheck without them having to think about it. The process is also fairly simply. You decide on an amount that you want to contribute to your 401K and each time you get paid, your employer takes the amount and puts it directly into your retirement account for you.

Avoid the default savings rate.

As a new employee, there is a good chance that your employer will automatically sign you up for the company's 401(K) plan but at a smaller percent of your salary than what you can actually contribute. In most cases, the amount is around 3 percent. Although this is better than having no retirement plan at all, it really isn't enough to maintain most people's lifestyle once they retire. You may find that this is initially as much as you can financially afford, but if possible aim for a higher amount, such as 10 percent, then keep increasing the amount every time you are given a raise until you are contributing about 20 percent of your pay.

Take advantage of matching funds.

As part of your benefit package, your employer may offer to match a portion of the amount of pay you put into your 401(K) each pay period. U.S. News states that in most cases, the matched amount is usually around 50 cents for each dollar saved up to 6 percent of pay. Using an employer match is one of the easiest and fastest ways to jump-start your 401(K).

Look at the bigger picture.

According to Forbes, if you're considering two jobs that are almost identical, it's important to think about your benefit package. They state that 30 percent of employers don't match funds put into a 401(K) or offer a small amount as little as 1 percent. Although one job may pay more, a job that pays a little less, but has a better retirement plan could make the job more attractive.

Staying until you are fully vested.

While it is certainly wonderful that your employer has chosen to match your contributions to your 401(K), there is one small caveat to keep in mind. In order for you to keep your 401(K) match, many employers require that you must stay with the company for a period time before you are considered fully vested. This means that if you choose to leave before this time period is up (typically five to six years), you forfeit all of the amount that the employer has matched. While matching contributions can certainly help jump-start your 401(K), if you leave before this time period is up, you may lose the employer's entire match.