We live in a world of uncertainties and that is the reason why it is always advisable to have a retirement planning and to start saving for the same as early as possible. The sooner you start working on it, the better retirement life you will enjoy. The benefits of planning early are manifold, which also include tax advantages. The first step is to explore the choices available to you primarily, there are three types of plan that you can choose from - SEP IRA, conventional and Roth IRA, and 401(k) and Simple IRA. SEP IRA refers to the plans for self employed individuals. The conventional and Roth IRA refers to the personal savings plans while the 401(k) and Simple IRA refers to the employer-sponsored plans. Following is a brief rundown on each of them.

Self Employed Plans
This option for retirement planning is for those who work as self-employed individuals. These are self-administered plans where you can save a certain amount of your monthly income and invest the same in a tax-deferred saving plan. However, you also have an option to contribute to an IRA simultaneously. As per the provisions of the SEP IRA, you are allowed to contribute $40,000 or 25% of your monthly income, whichever is less.   

Personal Savings Plans
Your employer may be offering you a retirement planning scheme at work, but you may still like to set up your plans for a more secured future. These additional plans are usually referred to as personal savings plans. However, here it is important for you to understand that Roth and conventional IRA schemes work differently. For example, where the contribution of up to $3000 annually is very much likely to be tax-deductible in case of conventional IRA, it is not tax-deductible in case of Roth IRA. But again, the Roth IRA plans allow you to withdraw your proceeds tax-free at the time of retirement. No taxes are charged on these proceeds. This way, your savings can grow tax free in either case.

Employer-Sponsored Plans
The employer you are working for can offer retirement planning schemes under plans like simple IRAs and 401(k). Your contribution towards these plans is tax-deductible. All your savings grow tax-free as long as you don't withdraw them. When you withdraw the proceedings at the time of the retirement, you may be charged taxes on it. As of now, the maximum amount of contribution in case of Simple IRA is $8,000, and in case of 401(k), it is $12,000. 

All these retirement planning schemes have certain provisions that you have to follow. Make sure that you meet the set eligibility criteria. For example, you may have to wait for a certain period of time after you are employed to participate in employer-sponsored plans.