Almost half of all Millennials in the U.S. are living paycheck to paycheck, and if you’re one of them, retirement can seem too far off to think about. Even though you’re scrambling to pay your bills each month, you need to make saving for retirement a priority now because the longer you wait, the farther you’ll fall behind.

Saving earlier for retirement lets you maximize the benefits of compound interest. If you’re in your 20s, make sure to set aside at least 10% to help have a more confident amount saved by age 65. However, if you wait until your 30s, you’ll need to save 15% to 20% and that number jumps to 30% if you wait to start saving for retirement until you’re in your 40s.

Where should Millennials put their retirement savings?

The traditional pension that many of our parents and grandparents used in retirement are a thing of the past. Also called a defined benefit plan, a pension offers guaranteed automatic payouts in retirement based on your salary and years of service. To save for retirement in today’s economy, you need to take a much more active role, rather than relying on your employer.

For Millennials, when it comes to retirement savings, there are three areas to consider: 401(k) accounts, IRAs, and HSAs. Contributing to and understanding the benefits and limitations of each of these will help you build a solid foundation for your future retirement.

401(k) Accounts

The employer-sponsored 401(k) plan (or a 403(b) plan if you work for a tax-exempt, nonprofit company like a school, hospital, or charity) is the most popular type of employer-sponsored retirement plan in America and has many benefits.

• It allows you to save and invest a portion of your wages tax-free, meaning you’ll pay less taxes now.
• Often, your employer will match the amount of money you contribute to your 401(k) up to a certain percentage – it’s like “free money” to help build your retirement savings.
• You can contribute up to $18,500 in 2018, making it a great option to maximize your retirement savings.

But life is full of surprises and you don’t want to limit yourself to a 401(k) that you can’t contribute to after you leave the job associated with it. Studies show that 45% of newly hired college grads will leave their employer in less than two years, so you’ll want to maximize your retirement savings beyond a 401(k), such as an IRA.

Roth and Traditional IRAs

Investing in a Roth IRA makes good financial sense for Millennials because you pay taxes up front. The money then grows tax free and you don’t pay taxes on it when you withdraw the money in retirement. Given that you are likely to make more money later in your career, and therefore pay more in taxes, Roth IRAs provide major tax savings over time. As a good investing vehicle, here’s what you need to know about a Roth IRA:

• To qualify for a Roth IRA in 2017, there is an income cap of $133,000 for singles and $196,000 for married couples filing jointly. (Roth eligibility begins phasing out for singles at $118,000 and $186,000 for married couples filing jointly. But don’t fret – if you don’t qualify for a Roth, you can still contribute to and benefit from a traditional IRA.)
• For 2017, the maximum amount a Millennial can contribute is $5,500 a year in a Roth IRA (this number jumps to $6,500 if you’re 50 or older) and you have until April 15^th of 2018 to establish and/or make your 2017 contribution.

HSA Accounts

The third tier of a healthy retirement savings strategy is investing in an Health Savings Account, or HSA. HSAs are tax-advantaged savings accounts designed to help people with high-deductible health plans (HDHPs) pay for out-of-pocket medical costs. This is a great option for all Millennials, especially for those who might change jobs or have varying medical expenses each year. Unlike the FSA your employer may provide, your HSA balance can be carried over from year to year, and moves with you if you change jobs. Other benefits to this powerful retirement savings tool include:

• Offering a triple tax benefit. The money is tax deductible when you put it in, it grows tax deferred, and you can take it out tax-free if used for qualifying medical expenses.
• The only caveat is you must have a HDHP, with a deductible of at least $1,300 for self-only coverage and $2,600 for family coverage to qualify for an HSA. But lower-deductible plans could be costing you more than this a year in higher premiums, making an HSA a great choice because your HDHP will closely match your actual health care needs.
• There’s no risk in contributing up to the maximum $3,400 for individuals (and $6,750 for family coverage) because the money rolls over from year to year.

While our parents and grandparents could rely on pensions and Social Security, the truth is that pensions are now virtually nonexistent and the Social Security system is changing. As a Millennial, you must take a more active role in saving and planning for your retirement. Don’t wait to start saving, and automate your contributions through payroll deduct or scheduled transfers out of your checking account to invest in your employer’s 401(k) plan, an IRA account, and an HSA to help maximize the financial independence of your future.