We all dream of an early retirement in a comfortable living environment, surrounded by the people we love. But as company culture changes and expenses change, retirement might seem further away than you’d have hoped. For some, retirement might even seem less appealing than work for fear of a lack of income.
Welcome in the new year with a new perspective on your retirement plan! Put saving on the top of your list of resolutions. Consider these tips to prepare for yourself for a happy and timely retirement.
Make a Plan
Many working Americans forget to think about their retirement. With the work grind and a busy schedule, it makes sense that retirement falls on the backburner when it seems so far away. Maybe you have a little bit of money trickling into your 401k every month, but you might not be taking advantage of a full-blown retirement plan.
With online retirement tools, you can check where you are with your retirement savings, and how far you still need to go in order to be comfortable in the future. Set up goals and read up on your company’s retirement plan policies. They might be matching your 401k contributions! If you have no idea where to start with your financing, there’s nothing wrong with asking for a little help. A professional financial advisor can set you up with a realistic plan that works for you lifestyle and your hopes for retirement.
Consider Your Stats
Different approaches to retirement are recommended depending on your age, income, the assets you own, and how old you want to be when you decide to retire. These are major components to developing your retirement plan. For example, if you’re only in your twenties or thirties, but hope to retire by the time your 55, aggressive contributions to your retirement plan are the way to go.
If you’re older, and retirement is just around the corner, it’s never too late to work on saving. Making small adjustments like flowing money directly into your IRA that you won’t miss now or downsizing on expenses that aren’t necessary can make retiring a lot less stressful than you think.
Ask a professional about the small things you can do in order to make retirement easier. With a proactive approach and an open mind, you’ll be ready for retirement in no time.
Think Positively about Retirement
Although retirement might sound like a scary place, it is ultimately the place you want to be in order to relax and be comfortable. You should be thinking of retirement as the goal rather than an unknown. It might be the time for downsizing or reducing expenses, but it is also the time when you don’t need to worry about work or income. You’re setting yourself up for a stress-free future.
Don’t let the hustle and bustle of a busy schedule let you forget about your retirement plan. Calculating your expenses and getting a better understanding of retirement only takes minutes. Developing a solid retirement plan may take longer, but there are plenty of resources out there to help you on your way!Continue reading
One of the best things about retirement savings is its status as a nontaxable fund. You’re always hearing about mistakes like withdrawing from 401ks and social security early, forcing Americans to pay heavy taxes on their retirement money. Because retirement and funding are complicated processes, there are a few mistakes you can make that will make your money taxed higher than you’d expect.
Individuals who are investing in their retirement often decide to rollover their accounts in order to invest differently, when they are changing their retirement plan, or when they start working at a new company. Individual retirement accounts (IRAs) are heavily regulated to prevent fraud, but because of this, you could easily make mistakes while rolling over your accounts.
According to a recent article by CNBC, you should keep in mind these three things when rolling over your IRA.
First, “When rolling over an individual retirement account, you want to try to do a trustee-to-trustee or bank-to-bank transfer,” says Ed Slott, an IRA expert at Ed Slott & Co. Second, “The other way to rollover an IRA is through a 60-day rollover, whereby you receive a check and must deposit it into a new retirement account [within the 60-day time period].” And third, “You can only do one 60-day rollover per year. If you do more than one, your retirement funds become taxable.”
You also have the option of using a direct rollover. According to the IRS website, “If you’re getting a distribution from a retirement plan, you can ask your plan administrator to make the payment directly to another retirement plan or to an IRA. Contact your plan administrator for instructions. The administrator may issue your distribution in the form of a check made payable to your new account. No taxes will be withheld from your transfer amount.”
When approaching the 60-day rollover, many individuals either neglect to deposit their checks within the time period. However, the greatest cause for concern is the once per year rule because many Americans are not aware of it, so they don’t even realize their funds are becoming taxable when they decide to rollover.
The 60-day rollover approach is particularly risky because it is the only form of rollover with the once per year rule. All other forms of rollover are exempt.
The penalty for a second rollover is fatal as you no longer have your money in the IRA, so you face the heavy taxes on this money as if you withdrew completely. When making adjustments to your IRA and other retirement accounts, you need to know all of the facts before you take action.
You should always be proactive about organizing your IRA and retirement plans. Play it safe and always consult a professional financial planner before committing to major changes with your savings. Remember that the decisions you make today can build you up toward a happy and comfortable retirement in the future.Continue reading
Are you afraid that it’s too late to start planning for retirement? You might think that if you’re in your 40s or 50s, it’s too late for retirement, but that shouldn’t discourage you from making moves toward a retirement plan today. As Morris Armstrong, a professional financial planner says, “You have to start somewhere.”
Although you might be starting later than other individuals on retirement planning. According to an article on Forbes.com, “Only 18% of American workers 55 or older say they’re ‘very’ confident they’ll have enough money for a comfortable retirement, and another 49% are ‘somewhat’ confident,” based on the Employee Benefit Research Institute’s 2017 Retirement Confidence Survey.
If you’re worried about your retirement plan, many Americans are in the same boat as you, so here are a few things you can do to get started on. It’s never too late to be planning for your future.
Reevaluate Your Plan
Do you already have a plan in place for what you’re going to do during retirement? Perhaps, your plan is outdated, or you haven’t actually made the contributions you were expecting to. Start by estimating you projected spending during retirement. How much money are you going to need on a monthly basis? Consider the areas where you’d draw income from and how much they will impact your retirement. If you’re not sure where to start, be sure to consult a professional financial planner!
Empty Nest? Time to Save!
As the kids enter adulthood and become more independent, you can reallocate the funds spent on your children into your retirement savings. If you are still making the same income that you were when you were funding your children’s livelihoods and education, you’ll notice that you can save a large amount of money.
Retire Spending Before Retiring
Many Americans adjust their lifestyles once they enter retirement. It might be as simple as opting for a basic cable plan and greater limitations on your phone plan. Anything you plan on changing during retirement can be changed now, so you can have a more comfortable retirement.
Turn Old Payments into Savings
Just finished paying off a car? School loans? Your home? Don’t look at the extra money you have at the end of the month as pocket change! Put it into your retirement savings. Since you were making the payments before, you won’t miss the money, but the retired you will thank you in the future.
Take Advantage of 401ks and Company Retirement Plans
When was the last time you contributed to your 401k? If you have money going into an external savings account, you might want to consider redistributing it to your 401k or a retirement plan offered by your work. This way you save on taxes and have a cushion to land on during your retirement. If you’re unsure about your company’s retirement plan, read up! Many companies contribute to their employees’ retirement plans, so don’t let this money go to waste.
Retirement can be a scary thing if you don’t feel prepared. Remember that you should never give up on saving for retirement!Continue reading
The new year is here, and it’s time to come up with some realistic and positive resolutions to improve your life. For the average working American, planning your retirement should be at the top of your list. As the years are whizzing by, now is the time to make necessary adjustments to your finances, so you can maintain a comfortable retirement.
In the midst of retirement, considering finances and thinking about your funds can be a very stressful experience. With the right approach, you can be sure that your retirement investments will be here to last.
The number one thing you should consider is the way you are spending your money. Where are your funds going on a monthly basis? What expenses are necessary, and what can be downsized?
Think about your sources for income. Do you have a pension? A 401k? An IRA? Are you withdrawing from social security? These are all areas where you should consider your spending. Evaluate how much you have in these funds and determine your limit on spending every month. Surprise expenses happen, but if you can minimize extraneous spending, you’ll have a lot to fall back on in the future.
What are the little things that you’re spending on that you don’t need to be? Perhaps you’re subscribed to newspapers and magazines that you don’t read anymore. Maybe you’re not watching as much TV as you’d anticipated, so you don’t need the most advanced cable package. Make lists of your monthly expenses and knock off the things that you simply don’t need. A little here and a little there, and before you know it, you’ll be saving a couple hundred.
In an effort to limit yourself, you can set up a payment plan with your investment system. Like a paycheck or an allowance, these payments are dispersed on a regular basis, but don’t give you access to your entire investment. This makes it much easier to keep track of your spending.
Even though you’re not making the big bucks anymore, that doesn’t mean you can’t have a little fun. Retirement is ultimately meant for enjoying yourself and relaxing, so if you’re looking to travel or take a new hobby class, do it! When the situation changes, you might regret passing up these opportunities when you had the chance. With careful spending and calculated financial plans, you can figure out what works for you. If you have trouble balancing your next adventure with your funds, talk to a finance professional about your next steps.
Above all else, remember to take care of yourself. In retirement, you have more time than ever before to think about your health. Exercise, eat right, and socialize with friends and family. From a financial perspective, a healthy lifestyle will keep medical expenses at a minimum, and you’ll be more mobile to do certain tasks on your own. From an emotional perspective, keeping a healthy mind and body will let you enjoy your retirement to the fullest.Continue reading