Secure Your Future with Retirement Strategies for Truck Drivers

Many people choose a career in trucking because it offers good pay, job security and opportunities for advancement. 

But retirement isn’t exactly top-of-mind for most folks when they first sign up to earn their commercial driver’s license or CDL. In fact, even many experienced truckers say they aren’t sure if they have everything they need to enjoy the good life after their driving days come to an end.

A 2023 survey by the American Trucking Association found that 34% of drivers are delaying retirement due to financial circumstances. That includes 36% of company drivers and 29% of owner-operators. Nearly two-thirds, or 63%, say they don’t have enough saved up to retire comfortably.

The good news is that you can enjoy an exciting career in trucking and have enough for your golden years with a little planning. At Prime Inc., our Success Sharing 401(k) plan lets company drivers save and invest for the future while earning competitive rates hauling cargo across the country. Independent contractors can plan for retirement through our Retention and Rewards Program.

Let’s take a look at what you need to know now for a happy retirement in the future.

Start Planning Today

If you’re just starting out as a truck driver in your 20s or 30s, retirement may not feel like a big priority at the moment. But the fact is, the earlier you start saving up, the better off you’ll be down the road.

The best time to start saving for retirement is your first day on the job. The second-best time is today, if you haven’t already started. Take the time to re-evaluate your strategy as you move through different life changes, such as marriage, the birth of a child or moving to a new city. Talk to a financial advisor to help you stay on track. Good questions to ask include:

• How much will I need in retirement?
• What are my retirement goals?
• What will be my living expenses in retirement?
• What costs will go up when I retire, and which ones will go down?

Some basic steps to retirement planning are as follows:

• Step 1: Set your retirement goals. Think about your expected lifestyle as a retiree, and estimate how much you’ll need to enjoy the life you want.
• Step 2: Estimate your time horizon. At what age would you like to retire? If retirement is still several years off, you might pursue a more aggressive investment strategy. Older drivers, for whom retirement is fast approaching, may prefer a more cautious approach.
• Step 3: Set a budget. Once you determine how much you need in retirement, start setting aside the appropriate amount each month to help you get there.
• Step 4: Be consistent. You’ll need to strike a balance between meeting your current living expenses and saving enough to meet your needs in the future.

Success Sharing: 401(k) Plans for Company Drivers

A 401(k) plan lets you set aside pre-tax dollars through monthly contributions to your account. 

Prime’s 401(k) Success Sharing plan is available for company drivers, beginning the first full quarter after being with Prime for six months. For every dollar you put into the 401(k) account, Prime will match it up to the first 3% deferred, and we’ll match 50% on the next 2% deferred. Your money is immediately vested.

Each individual driver gets to decide how much to contribute out of each paycheck. You also have options when it comes to investing the money you set aside, such as stock, bonds, mutual funds or real estate. 

Retention & Rewards Program: Retirement Plan for Independent Contractors

Prime offers the Retention and Rewards Program to give independent contractors long-term benefits that are similar to those in a traditional retirement plan. Under the administration of UBS Paine Webber, the plan lets independent contractors earn investment returns on contributions made entirely by Prime and/or Success Leasing. 

Eligibility begins after one year of service. At that time, independent contractors may begin having contributions made to the Retention and Rewards Program on their behalf. Here are the basics:

• The plan is fully vested after 10 years of enrollment.
• Prime Inc. contributes $1,000 annually.
• Success Leasing contributes $500 annually, with a leasing agreement.
• The plan offers three investment options.
• The plan pays out beginning at age 65.
• Independent contractors have the option of choosing a lump sum or two separate payments. 

Traditional or Roth IRA

An individual retirement account, or IRA, works similarly to a 401(k) in that it lets you set aside money to invest for the future. If you open an IRA, you have two options:

• A traditional IRA uses pre-tax deposits, which means you will owe taxes on the income you receive from the account when you retire.
• A Roth IRA lets you make after-tax contributions now in exchange for tax-free dividends later.

You have the option of setting up regular, automatic deductions from your checking or savings account to your IRA. 

Real Estate

Investing in real estate offers the chance to earn money from a portfolio of attractive properties with good returns. Options include multifamily properties such as apartments, single-family homes or vacation rentals. A property manager will oversee day-to-day operations of the property, such as rentals, maintenance and marketing. 

Social Security

Social Security benefits will cover a portion of your average earnings after you retire. You can apply to receive benefits at any time between the ages of 62 and 70. The longer you wait, the more you will receive. 

Other factors will also affect how much you get from Social Security: 

• Health care payments: Medicare eligibility begins at age 65, including Part A (hospital insurance) and Part B (medical insurance). If you sign up for Part B, the cost will be deducted from your monthly Social Security benefit.
• Tax withholding: You may pay federal income taxes on your benefits if your combined income exceeds the threshold.
• Continuing to work: If you’re still driving before Full Retirement Age – between 66 and 67 – your benefit will be temporarily reduced if you exceed the earnings limit for the year. If you work after Full Retirement Age, your earnings will not reduce your payment.

Drive for Prime & Earn Fantastic Benefits

At Prime Inc., we’re proud to offer industry-leading pay and benefits to our company drivers and independent contractors. Our Success Sharing 401(k) and Retention and Rewards Program enable drivers to save and invest for the future while earning money hauling loads. Other benefits include medical, dental, vision and life insurance, vacation time, safety bonus, home time and passenger and pet policy. 

If you’re ready to launch your driving career, Prime lets you get paid while you train before and after obtaining your CDL. We invite you to apply online and start Driving for Prime right away!