401(k)s and Roth IRAs are two unbeatable strategies for retirement savings. 401(k)s are retirement savings plans available through your employer. You defer paying taxes on the amounts you contribute until you withdraw the funds at retirement. A Roth IRA is an individual retirement account you can set up for yourself, in which you can set aside after-tax income up to $5K per year; earnings on the account are tax-free.
Some employers will match all or a percentage of what you contribute to a 401(k) or Roth IRA. Although reducing debt should be priority number one when it comes to lowering financial stress, you should make an exception if your employer offers any sort of matching against your 401(k) or IRA contributions.
If you can't decide how to invest the money you put in your 401(k) or IRA, consider stashing it in a targeted retirement fund. You tell these funds the year you plan to retire, and the fund chooses a mix of stocks and bonds that will deliver the best return with the least risk based on the amount of time you have until your projected retirement date.
Now that you've shifted your attitude and mastered the basics, you should feel less stressed out and more in control of your finances. At this point, its time to have a little fun. We talk about ways to juice your credit score next.