Along with making money with their business, most small business owners also try to minimize income taxes and grow their wealth. Qualified retirement plans present an excellent opportunity to accomplish these last two objectives. While the rules for retirement plans can be confusing and you may want to consult qualified tax and investment advisors, here…
Individual retirement accounts (IRAs) continue to be one of the most powerful ways to accumulate funds for a financially secure retirement for a multitude of reasons: IRAs are convenient ways to save money. IRAs are available to everyone with wages. Earnings within IRAs are not subject to current taxation. Contributions may be deductible in some…
Automatic Savings Plans for Your Retirement Your IRA – Transferring $458.33 each month will fund your 2015 IRA contribution of $5500 or $541.66 for a contribution of $6500 if you are age 50 or above. Additional retirement savings – Consider transferring $500 (or some other amount) from your checking account to your savings account each…
Individual Retirement Accounts (IRAs) are part of a financially secure retirement for many people. Regular IRAs became popular in the 1980s and the Roth IRA was created in the late 1990s. For many, balances in their IRAs have become a significant part of their net worth from contributions, rollovers from other retirement plans and growth….
Roth IRAs are often more attractive than regular IRAs because distributions are tax free and there are no required minimum distributions beginning at 70 1/2. The most common drawbacks with Roth IRAs are that contributions are not deductible and those with high incomes may not be eligible to make Roth IRA contributions. If a Roth…
The answer to that question is not necessarily simple. There are several factors to consider: What is your age? Do you plan to continue to work? How badly do you need or want the monthly benefits? How long do you expect to live? The first two questions are simple. The third question probably depends on…
1. The average monthly Social Security retirement benefit for a retired couple is: a. about $900 b. about $1000 c. about $1400 d. more than $2000 d) In 2017, at the normal retirement, the average retirement benefit for a couple is about $2,260 per month. To reflect the impact of inflation, benefit levels are adjusted…
Your Individual Retirement Account (IRA) is one of the four main components of a financially secure retirement. Anyone with wages under the age of 70 ½ can contribute, the annual contribution limits have been increasing and there are tax benefits. Benefits Add Up The amount you can accumulate depends on two factors – what you…
Your Individual Retirement Account (IRA) is one of the four main components of a financially secure retirement. Anyone with wages under the age of 70 ½ can contribute, the annual contribution limits have been increasing and there are tax benefits. Benefits Add Up The amount you can accumulate depends on two factors – what you…
Add $50,000, $100,000 or even $500,000 to Your Retirement Savings Your personal savings are one of the four building blocks of a financially secure retirement along with your company’s retirement plan, your IRA and Social Security. The amounts you will receive from those last three sources are somewhat out of your control. Social Security benefits…
Welcome to the podcast series – Take Control of your Financial Future. In this session, we are going to review some of the decisions you must make when you change jobs and get a lump sum distribution from your retirement plan. If you have participated in a company retirement plan, like a 401(k) plan, and…
Welcome to the podcast series – Take Control of your Financial Future. In this session, we are going to review the fundamentals of planning for retirement. Most people say that a financially secure retirement is one of their primary financial goals. Retirement may seem far over the horizon and not worth thinking about. However,…
The choice of investments for your retirement funds is never easy. The funds you have saved for your retirement deserve special attention. How much you save and the returns on those funds may be the difference between being able to have the lifestyle you want during retirement or being forced to accept something less….
There have been several major tax law changes over the past few years with staggered effective dates. These laws have significantly changed the way you may want to consider your financial situation, especially retirement planning. Here is some information that you find helpful: Income Tax Rate Schedules for 2019 2019 Single Return Rate Schedule 2019…
The Social Security System has been a large and visible part of the American financial system since the 1930s. When President Franklin Roosevelt signed the law, it was designed to be a financial security net for older Americans. The system was set up with workers paying into it and beneficiaries getting retirement and other benefits….
Most of us think of IRAs and retirement plans as financial tools for asset accumulation. We often pay little attention to how funds can be withdrawn from the accounts until retirement. Here are some general rules on how funds coming out of IRA accounts are treated for income tax purposes. This discussion applies only to…
If you are changing jobs, retiring or being terminated from a job, it is natural to undergo stress and anxiety. Usually, these changes are also accompanied by receiving a distribution from your employer’s retirement plan. There are three important decisions that must be made about these distributions. Do you want to pay tax on it…
Social Security benefits will probably be a major source of your retirement income. While there may be changes to the Social Security system over the coming years, all indications are that this program, started in the 1930s, will continue to provide retirement benefits to Americans well into the 21st century. Social Security Reports The Social…
Social Security benefits will probably be an important source of income once you retire. The amount you will receive is based on a number of factors including your earnings history, the age at which you retire and annual Cost of Living Adjustments made to payment levels. Earnings History The Social Security program limits the amount…
The volatility in the stock market over the past few years has resulted in many investors seeing their retirement accounts shrink in value. While the stock prices may rise over time, many individuals are being forced to re-examine their retirement plans. For older individuals with less time until their planned retirement, a serious review of…
Accumulating the funds you will need for a financially secure retirement can be difficult. Even though your living expenses during retirement may only be 70% to 80% of those before retiring, you must remember that you will not have your normal paycheck and your Social Security benefits will probably not be large enough to let…
Putting off, or not making a contribution to an IRA can be easy. There may be other uses for the funds that seem more urgent – a vacation, a down payment on a new car, new furniture or maybe just leaving the funds in a regular account to build some liquidity. However, making that $6,000…
Since 2010, individuals with Traditional IRAs have had the option of converting all or part of their funds in a Traditional IRA to a Roth IRA regardless of how much they earn. This is an important tax and estate planning opportunity that many may find attractive. Background Traditional and Roth IRAs have identical contribution limits…
Longer life spans, more active retirements, rising costs and uncertainty over Social Security make the need for a substantial retirement nest-egg greater than ever. Luckily, many corporate retirement plans offer employees control over building that nest egg. Benefits of 401(k) Plans Convenient Saving. Contributions each pay period make it easier to accumulate significant amounts over…
If you have participated in a company retirement plan like a 401(k) plan and change jobs, you will probably receive a distribution of the funds you have accumulated in your plan. The distributions are often called lump sum distributions. If you have participated for several years, the distribution could be quite substantial. Over the course…
Most people identify a financially secure retirement as one of their primary financial goals. As you begin your financial life, retirement may seem to be far over the horizon and not worth thinking about. However, by spending a little bit of time now and doing some relatively easy things, you can put yourself on the…
Retirement is probably many years, if not decades, in the future. Yet, being able to afford a financially secure retirement is expensive and understanding some of the basics now and taking a few steps can make that retirement you dream of a reality and even a few years sooner than what you think. Any discussion…
Few teenagers think much about retirement, but funding an Individual Retirement Account may be one of the best financial steps they will ever take. The reasons are simple – taxes and time. IRAs can be established by individuals of any age. The only requirement is that they have earned income equal to or exceeding the…
Individual Retirement Accounts can be part of the foundation of a financially secure retirement. For many years, millions of individuals have made annual contributions to IRAs or used them to receive distributions from retirement plans on changing jobs or retiring. Several years ago, a new form of IRA was created called the Roth IRA. The…
In almost every case, the answer is a resounding YES. Planning for a financially secure retirement is most often ranked as the number one reason why people save and invest. Social Security and company pension plans may provide some of the income you need during retirement, but contributions to your company retirement plan and…
Changing the Social Security program continues to be a hotly debated topic. Some politicians want to make major revisions with individuals having the ability to manage a portion of their Social Security tax dollars. Others advocate increasing the tax rate, increasing the level of income subject to Social Security tax, increasing the retirement age (even…
Most people identify a financially secure retirement as one of their primary financial goals. Reaching that goal can be easier by examining the four sources of income you will have during retirement and identifying steps you can take now to increase each of those sources. Social Security Retirement Benefits The Social Security system has played…
Your Individual Retirement Account can be part of the foundation of a financially secure retirement. Many experts suggest that your living expenses after retirement to average 60% to 75% of your pre-retirement expenses. Social Security will provide some benefits, but your retirement income will primarily depend on your other assets including your company retirement plan…
The almost-annual changes to the income tax laws have created confusion about Individual Retirement Accounts (IRAs). This confusion has caused many people to ignore one of the most powerful tools available to help them secure a solid financial future. Even with all the changes, IRAs can and should be a key part of the foundation…
Determining exactly how much you need to save for retirement can be complicated. To do the perfect calculation, you need to know your level of expenses during retirement, your future tax rates, the future returns on your assets and ultimately how long you are going to live. With all these uncertainties, the thought of doing…
Many companies provide dividend reinvestment plans for their shareholders. The concept and mechanics are relatively simple. Each time the company pays a dividend, your dividend amount is used to buy additional shares instead of being distributed to you as a check. Benefits of a dividend reinvestment plan. You end up owning more shares, somewhat “painlessly.” …
Ideally you should do both if you can afford it. Having enough funds to afford the retirement lifestyle you desire is an important goal for many. IRAs and 401(k) plans both offer a tax-advantaged way to accumulate funds. Step One In most cases, participating in a 401(k) plan should be your first choice….
A wise person once said that humans tend to over-estimate what they can accomplish in the short-term and under-estimate what they can accomplish in the long-term. This holds very true for IRA contributions. IRAs offer a number of benefits: Regular savings Potential tax-deductible contributions (depending on income levels and other retirement plan participation) Tax-deferred compounding…
Most 401(k) retirement plans allow participants to borrow from their accounts within the retirement plan. This source of funds can be helpful if you need money, but is not always the best solution. Here are some of the issues to consider before making the decision to borrow from your retirement plan. Why borrow at all?…
The Social Security System has become a visible political as well as financial issue. The system was started in the 1930s to provide a secure source retirement income and other benefits in the cases of death or disability. The system is funded with payments from workers and employers with payments going out to retirees…