 Decide what type of tax shelter you qualify for, and what gives you the best outcome  All tax shelters require EARNED income  What does your employer offer  Is this money for retirement, or for down payment on your first house  Can you avoid using this money for at least 5 years?

 Pre-tax (Tax- Deferred)  You pay tax on income + interest/R.O.I when you withdraw your savings at retirement  Post-tax  You pay tax on income before you invest it (no tax deduction), and all interest/R.O.I is tax-free!

 401k-Employer provided & controlled (Pre-tax $)  Possible employer “match”  Roth 401k (Post-tax $)  403b-Govt. employee (Pre-tax $)  457-Shool employee (Pre-tax $)  TSP-Fed. Govt. employee (Pre-tax $) $17,500 max contribution each

 I.R.A  Traditional-Anyone (Pre-tax $)  Roth-Anyone (Post-tax $) $5,500 max. contribution for either Traditional or Roth You can do a Roth IRA in addition to a 401k  SEP-Self Employed

 Decide where to put the “sheltered” money  Risk tolerance/time horizon relationship  What is your risk tolerance?  What is the time horizon (the longer the horizon the more tolerance you should have for risk)  Diversify your portfolio  Use investments that offset each other  Be sure to check the diversification once a year

 Target or Life-Cycle Funds  Pick the duration, and they will choose the diversification.  Easy & simple, but not as good as knowing how to diversify the money yourself  May be a good way to start, but you should learn how to do it yourself in the future

 Vanguard Target Retirement 2050 Vanguard Target Retirement 2050  T. Rowe Price Retirement 2050 T. Rowe Price Retirement 2050

 Trades like a stock, but holds multiple stocks or investments  Easy to diversify  Buy “segments” of the stock market  Very low expense ratio (lower than mutual funds that do the same thing)  You do need to know what you’re doing!

 SPDR Dow Jones Average ETF SPDR  VOO Standard & Poors index ETF VOO

There’s a lot of information on the internet. Each source will have some bias, so be aware of it and do not take any single source’s information as the correct answer. Here are just a few places to learn more:   m m  