The U.S. government has introduced an IRA, allowing individuals and workers over 50 to contribute up to $7,000 and $8,000.
In 2024, businesses can make elective deferrals of up to $23,000, with a non-elective contribution of 25% of compensation, totaling $69,000, including catch-up contributions of $7,500.
Littell suggests a formula for pension payouts, which is 1.5% of final average compensation multiplied by years of service, resulting in an annual pension payout of $18,750.
Individuals can purchase guaranteed income annuities to create their own pensions, with deferred income annuities being more popular over time, as immediate payments are less comfortable.
The Thrift Savings Plan (TSP) offers government workers and uniformed services low-cost investment options, including bond, S&P 500, small-cap, international stock, and Treasury securities.
Cash-balance plans promise hypothetical account balances based on contribution and investment credits, such as a 6% company contribution credit and a 5% annual investment credit.
Whole life, variable life, universal life, and variable universal life offer death benefits and cash value, with premiums coming out first and not taxed.