What should you do with your refund?

By Matt Porter

April 15, 2014 Updated Apr 15, 2014 at 6:52 PM EDT

(WBNG Binghamton) Stringing a guitar in the Music City front counter in Vestal, 26-year-old Ryan Nickerson said he doesn't think much at all about saving.

"I'd be surprised having money set aside to go for a weekend vacation," Nickerson said.

Each year he receives a generous refund from his taxes, but he said all of it goes to paying off his existing debt.

For him, putting away for retirement is a fantasy.

"Literally none, literally no thought towards it at all actually," Nickerson said.

Financial consultant Teresa Flynn said Nickerson's view on saving is something she fears too many Americans share.

"In America, too many people are in debt," Flynn said. "We tend to have the highest credit card debt of all countries."

Flynn works at Visions Federal Credit Union as a LPL Financial specialist.

She advises her clients to set aside an amount they can afford each month to invest in their retirement.

"Many people figure they pay their bills first, and whatever's left they'll save," she said. "And many times, there isn't anything left at the end."

The United States Department of Labor reports fewer than half of Americans are planning for retirement.

Flynn recommends people have a few months of income saved in a traditional savings account for emergencies.

After that, she recommends young people like Nickerson open up a Roth IRA where people can contribute up to $5,500 a year tax free.

She said just $20 to $25 a month can mean thousands or tens of thousands of dollars in the course of 40 years.

"Many investment plans start with as little as $25 a month," Flynn said, "And you'd be surprised how that can add up over time."

Flynn said if people want to have any sort of retirement, planning ahead early is the key.

"The only time you can retire is when you have enough money set aside," she said. "And the earlier you start saving, the more you'll have."

A 2014 survey by the non-profit Employee Benefit Research Institute of 1,000 workers showed 1 in 3 Americans have saved $1,000 or less in retirement accounts not including any employee sponsored 401k plans.