401(k)

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How to Turn a Financial "Don't" into a "Do"

A lot of financial advice is framed as things you should never do. Here are a few “don’ts” you’ve probably heard more than once: Don’t borrow money from your retirement plan. For instance, see 4 Reasons You Should Never, Ever Take a 401(k) Loan. Don’t take a loan or use your credit cards to fund your dream to… [fill in the blank — start a business, go back to school, relocate, etc.] Don’t borrow money from (or lend money to) family or friends. Here’s a quick take from financial advisor Dave Ramsey on why this is always a bad idea. Don’t accept a lower salary when changing jobs. Don’t rent when you can buy. For instance, David Bach, co-founder of AE Wealth Management, believes that millennials should buy, not rent. Do all these “don’ts” and others like them really apply to every person and every situation? Of course not. But…

What to Know About Retiring at 62 Versus Retiring at 70

Ah, retirement. That long-awaited life stage when all your hours of working, saving and family-raising efforts finally pay off. You’ll be free to travel, spend time with friends and family and enjoy the hobbies you never had time for. No worries, no stress, nobody to answer to. Except, without careful planning that scenario could be a fantasy. A 2017 Ipsos/USA Today poll found 45- to 65-year-olds surveyed, 30 percent had less than $100,000 in savings. Another 30 percent had no savings at all. No matter how much money you have invested for your retirement, deciding when to make the leap can drastically affect how far those investments can carry you. Trying to decide when to retire? Here are some things to consider if you decide to retire at age 62 versus age 70. Your Social Security Benefits At age 62: More people (42 percent of men and 48 percent of…

Are You Being Careful With Your 401(k)?

In time where traditional pensions are all but extinct, 401(k) accounts are key to many people’s retirement strategies. You just set them up, make sure you put money in and that’s it. Right? Trick question. A 401(k) needs management in order to be the retirement nest egg you want it to be. Your employer put it in place for you, but it’s up to you to make it work for you. There’s plenty of information out there on managing a 401(k) and the mistakes people make with their accounts. Even the IRS has some definite opinions on how you should go about making 401(k) decisions. We’ve assembled some of the more common things people don’t realize about their 401(k) accounts, along with some resources to help you make the most of yours. It Costs You Money to Have a 401(k) “Employer-provided” doesn’t mean “100 percent employer-funded.” There are personal costs…

What You Should Think About When Thinking About Retiring

A Gallup Poll in 2016 reported that nearly two-thirds of Americans worried they did not have enough money for retirement. With other polls showing the retirement age is rising and more data showing Americans should expect to retire even later in life than previous generations, what effect does that have on your future plans? Check Your Savings and Create a Budget It seems to be an obvious first question: Do you have enough money socked away in savings? A majority of pre-retirees probably don’t have enough in savings if they wanted to quit working tomorrow. Life expectancies are growing, yes, but many Americans simply don’t save enough of their income to begin with. Savings should be at least 10 percent, if not more. For whatever reason, and it’s not always for reasons we can control, people tend to save less. How do you know if you’ve saved enough? And what…

Should Women Save for Retirement Differently Than Men?

With cost of living outpacing salary growth and an ever-increasing average lifespan, saving enough for retirement is daunting for anyone. Women, in particular, face challenges on the road to retirement that men do not, which result in reduced quality of living during their later years. A survey by the Transamerica Center for Retirement Studies found only 12 percent of working women are “very confident” in their ability to retire comfortably. An additional 46 percent are “not too confident” or “not at all confident.” This lack of confidence is, unfortunately, warranted. The average Social Security benefit for women 65 and older is less than $14,000 per year, compared with $18,000 for men. As a result of this disparity, Women over 65 are 80 percent more likely than men to be living in poverty, according to the National Institute on Retirement Security. TIAA Chief Income Strategist Diane Garnick authored a report in…

Self-Employed Retirement Options Your Future Self Will Love

You’ve hustled your heart out and now you’re your own boss. With estimates that over 25 million Americans were engaged in entrepreneurship in 2016, this is becoming a reality for many. There are definite perks: pursuing your passion, setting your own hours and maybe even working from home in your pajamas. But there is one thing that many people might miss from a traditional 9-to-5 job—a retirement package that comes free from guesswork. While it may be a bit more complicated when you are your own boss, planning for retirement is possible when you are self-employed. Any entrepreneur who wakes up excited for their work may not think much about the retirement part. However, effective retirement planning is important for self-employed individuals. Not only can it set you up for financial freedom in your golden years, it can lead to some major tax advantages now. Choosing the right plan is…

Steps to Take to Retire Early

Early retirement has always been a dream of many people, but some are taking solid steps today to ensure an early retirement. Why work until you are 65 or 70 years old when you might be able to retire at 50 or even younger? Follow these steps to get on track for an early retirement. Save Aggressively To retire early, you will need money to support yourself and possibly your family, for the rest of your life. Social Security doesn’t kick in until you reach the government mandated 62 years old. You need a nest egg to live on. Experts agree that most people should save 10 percent to 15 percent of their gross income every payday to maintain the same standard of living in retirement. If you are retire early, you have fewer years to save. In this case, you should work to increase your savings to 50 percent or…

7 Bad Money Habits That Can Ruin Your Finances

Habits can make or break our personal finance success. While good habits can help you build savings and live without financial stress, bad money habits can turn into a downward spiral of debt, fees and struggles. Making some small adjustments to your financial habits is easier than you may realize. Break these seven bad money habits to put yourself on track to a happy financial life. Making Only the Minimum Payment When you get a loan statement in the mail, whether it is from a credit card, mortgage or student loan, you can quickly find your minimum payment for the next month. The key word here is “minimum.” Paying only the minimum payment means you pay the maximum possible interest over the life of the loan. Every dollar you pay early saves you on interest every single month for the remainder of the loan’s life. The more you pay sooner…

Everyone Needs To Know These Common Paycheck Deductions for Taxes and Insurance

Guess what? You’ve got three extra days to figure out your paycheck deductions and file your tax returns this year. Yup. Due to some magic in the calendar and “Emancipation Day”, tax day is Tuesday, April 18th. Taxes fund our military, the roads we travel on, they help support firefighters and law enforcement, along with myriad other benefits that we may take for granted.  Knowing that your hard earned money supports law enforcement and their family may make you feel good, but it doesn’t change the fact that you may still cringe from time to time when we see how much of your paycheck goes to taxes. A salary of $50,000 a year, paid every two weeks or 26 pay periods is $1,923.07 each paycheck, right? Wrong. Your gross pay is $1923.07, but that is the amount before a number of withholdings have been taken from your paycheck and you’re presented with…

The Starter Guide: Truths About Financial Advisors Everyone Should Know

As your finances become more complicated over time, it is common to need a little extra help managing your monthly cash flow, tending to various investments, and preparing for retirement. Schools do not teach about money, so there is no surprise that people just like you need regular help managing their money. If you think finding a financial advisor might be right for you, follow this guide to understand the many aspects of this important decision. Interview Several Financial Advisors At the start, you should plan to speak with multiple advisors before you pick the right one. You shouldn’t blindly trust the first person you meet with your money. Instead, take the time to meet with several financial advisors so you can understand their unique investment style and financial philosophies. Go into each interview with a list of questions and have a friendly discussion to learn more about their experience…

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