Plan For Retirement Now Because Time Flies
Barry Waxller
The first baby boomer has claimed social security benefits, which should be an eye opener for all of us. Specifically, the issue is retirement planning. Few of us do enough of it as the following facts and tidbits reveal.
If your employer offers a tax-sheltered savings plan, such as a 401(k), sign up and contribute all you can. Your taxes will be lower, your company may kick in more, and automatic deductions make it easy.
Open an IRA. IRAs are easy to get, easy to contribute to and easy to save with. Most Americans can set up an IRA - whether it's a traditional IRA or a Roth IRA - and save on taxes.
Remember to review your Social Security Statement each year for accuracy. This is your fallback retirement position, so make sure it is correct.
If you can, consider working a few extra years after your retirement age. It can make all the difference in your retirement income.
Social Security pays the average retiree about 40 percent of pre-retirement earnings.
Of the 60 million wage and salaried women working in the United States as of March 2005, just 47 percent participated in a retirement plan. Remember, even small amounts can earn interest and add up over time.
Your nest egg assets may seem large, but what about taxes when you start liquidating them? Do you have a tax strategy in place? If not, meet with a financial planner and accountant to deal with them.
Social security benefits are not determined by your total contributions. Instead, your benefits are based on your 35 highest earning years.
For the average worker Social Security replaces only about 40% of pre-retirement income, the balance must come from pensions and savings and investments.
Your social security statement should come to you each year around your birthday. If it does not, contact the agency to update your address.
An investment of $10,000 that earns 10% annually over the course of 40 years will amount to nearly $453,000 at the end of that stretch of time. Over the course of just 25 years, however, that same 10 grand increases to a mere $108,347.
Retire to a warm, dry location. Areas such as Las Vegas tend to have fewer pollens and pollutants in the air, which is good for your health. Good health equals lower medical bills.
Rip up your credit cards and pay off all balances. Once done, use the money you would have paid to credit card companies for your retirement funding.
Don't access the equity in your house unless the money is used to improve the value of your home. Don't buy flat screen televisions and such.
When is it too late to start saving for retirement? It never is. People starting at 50 can still save a lot of money.
For most people, retirement is their biggest financial worry. The key to limiting this concern is to save every penny you can today. Time will make all the difference in your returns, so make sure you save, save, save!
Barry Waxler is a http://www.ufcamerica.com/ financial advisor with UFCAmerica.com.
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