Tag Archive | "planning for a secure retirement"

Protect Your “Other” Biggest Retirement Asset


For many Americans, their biggest financial asset is their home. But, since some of us are priced out of the housing market, that asset is our retirement savings. It’s easy to make mistakes when planning for retirement, so it’s important to protect your “other” biggest retirement asset.

Protect your “other” biggest retirement asset — your tax-deferred retirement accounts.

Protect your “other” biggest retirement asset

If you’ve accumulated a significant amount in your retirement funds, you should keep these three things in mind:

Backup beneficiaries. The biggest mistake we see day in and day out when meeting with prospective clients is the lack of correctly designated beneficiaries. The easiest and best thing you can do is to verify that you have a primary and contingent beneficiaries listed on all of your retirement accounts. It’s not enough to list generic beneficiaries like “my living spouse” as primary and “my living children” as contingent beneficiaries.

Prudent investment strategies.Even the best-laid investment plan can fail and one of the most common mistakes is taking an unhealthy level of risk with your retirement accounts. If you’re expecting your IRA to last the rest of your life and beyond it is critically important to control risk.

Correct custodial and trust documents. Many retirement savers are unaware of the hidden dangers in IRA custodian documents or trust arrangements. hey sign these important documents without fully understanding the consequences. Dust off your IRA custodian document and double-check the fine print to verify that your beneficiaries are not able to receive their IRA inheritance in a lump sum fashion and pay a huge tax bill.

It’s critical to the financial security of your retirement that you plan wisely and have all the information you need to make the correct decisions for your situation. You want to make sure your funds last as long as you do, so take steps now to protect your “other” biggest retirement asset.

Click here to learn more about how you can protect your “other” biggest retirement asset.

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Save Your Retirement From Financial Advisors


Almost all of us — to some degree — have bought into the myth that financial planners know what they’re doing and that we should follow their advice because they’re — well — experts. They’re not. It’s not really their fault, either. You see, they’ve bought into the myth as well. Maybe now is the time for you to save your retirement from financial advisors.

Take the time now to learn about investing and save your retirement from financial planners.

Save your retirement from financial advisors

When it comes to saving for your retirement here’s all the specific advice I’d ever share:

  1. Start saving young and save as much as you can.
  2. Live within your means.
  3. Don’t touch the principal.
  4. Diversify to mitigate the effects of inevitable market swings — the more diverse, the better.

Everything else is just smoke and mirrors because — as all financial planners will tell you — past performance is no guarantee of future results. We cannot — and they cannot — predict the future. Yet we persist in believing the myth. The problem, according to Ms. Helaine Olen, a freelance journalist and author of “Pound Foolish: Exposing the Dark Side of the Personal Finance Industry” is this:

…“most of the financial advice published and dished out by the truckload is useless” — that it is simply “oblivious to the messiness of the human condition.”

And that “human condition” makes us our own worst enemies.

Ms. Olen writes that the “financial therapy movement,” for all of its flaws, “has hit on one universal truth: When it comes to money, the vast majority of us are nuts. Bonkers.” She counts some of the ways: “We don’t open our 401(k) statements. We ‘forget’ to pay our bills or file our taxes until the last minute.” Financial literacy is alarmingly low. Many of us don’t budget at all.

Our own lack of experience and understanding about investing and finance make us easy targets for those unscrupulous individuals who know they’re blowing smoke, but do it anyway.

A 2009 AARP survey found that nearly one in 10 people over 55, or about 5.9 million Americans, had attended a free financial seminar in the last three years.

At the World MoneyShow, an annual event in Orlando, 80 percent of attendees were over 55. The author [Ms. Olen] writes that “a panicked baby boomer is their best customer.”

Knowledge is power — even just a little bit of knowledge. Learn about investing. Like anything else, it’s scary and incomprehensible at first, but before long, you’ll know at least as much as most professionals and you may be able to save your retirement from financial planners.

Click here to read more about how you can save your retirement from financial planners.

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Start Now To Get The Most From Social Security


Social Security may be the primary source of retirement income for many of us, so it’s important to start now to get the most from Social Security.

Start now to get the most from Social Security.

Start now to get the most from Social Security

The payment amount you’ll receive when you start receiving Social Security depends on many factors. Here are some things you can do to boost your payout when retirement time rolls around.

  1. Work for at least 35 years.
  2. Earn more.
  3. Work until your full retirement age.
  4. Delay claiming until age 70.
  5. Claim spousal payments.
  6. Claim twice.
  7. Include family.
  8. Don’t earn too much in retirement.
  9. Minimize Social Security taxes.
  10. Maximize survivor’s benefits.
  11. Make sure your work counts.

Some of these — like working for at least 35 years — require forethought and planning. You should start now to get the most from Social Security.

Click here to learn how you can get the most from Social Security.

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Credit Card Debt Can Ruin Your Retirement


Credit card debt is a fact of life for most Americans, but many of us don’t think about the disastrous effect it can have on our future. The truth is, not only can it cause havoc with your current finances, credit card debt can ruin your retirement.

Credit card debt can ruin your retirement.

Credit card debt can ruin your retirement

You’re probably familiar with the concept of compound interest — it’s what makes building a healthy retirement nest egg possible. But that same principle is at work with debt.

Let’s say you’re the average American with $6,500 in credit card debt at a 14.5 percent interest rate. That means your estimated initial minimum payment will be $130 a month. And if you just pay the minimum, you’ll have to make payments for 26 years to pay off the balance, paying a whopping grand total of $8,938 in interest charges.

Wouldn’t it be nice to add that much to your retirement fund instead of paying it on purchases that have long since been cast aside?

So credit card debt, when you carry a balance for years, takes away from the income that you can save for retirement. But if you’re like most people, you may still want to split the difference – putting part of your disposable income into retirement savings and part of it into paying extra on your credit card.

Even “splitting the difference” isn’t always a good idea, especially if you’re paying a high interest rate on a large balance.

If your credit card has a 15 percent interest rate, but your IRA is only earning 8 percent, it almost always makes more sense to pay off your credit card debt ASAP, and then to put more money into your IRA. You’ll get more bang for your buck this way – by paying off the credit card as quickly as possible, you’ll save more interest than you would make by putting that extra money into retirement savings.

Of course, there’s always an exception to the rule. In this case, it’s the employer matching contribution to your 401(k). (By the way, a hefty employer match is about the only reason for putting money into a 401(k) instead of other investments.)

The only exception here is if your company matches part of your retirement savings. If you get a company match, you’re getting free money. Don’t pass it up. Contribute enough annually to your retirement account to get all of the possible company match.

Carrying credit card debt into retirement creates an even worse financial scenario, primarily because most of us will be on a fixed, limited income. High interest rates on credit card debt can ruin your retirement, so pay it down and only use the card for purchases you know you can pay off quickly.

Click here to read more about how credit card debt can ruin your retirement.

Posted in Creating a Personalized Retirement Plan, Planning for Your Retirement, Retirement Plan Challenges, Saving for Retirement, The EconomyComments (0)

Avoid Scams That Could Ruin Your Retirement


Whether you’re old or young, savvy or naive, rich or poor, there’s a chance you have — or might be — scammed at some time in your life. Some are just harmless practical jokes, but when it comes to your finances, you can’t take chances. It’s essential that you avoid scams that could ruin your retirement.

Scams like the “grandchild in trouble” threaten your retirement security. Protect yourself and avoid scams that could ruin your retirement.

Avoid scams that could ruin your retirement

Here are some perfectly normal — and universal — human tendencies that could get you into trouble:

  1. People aren’t always rational
  2. We’re attracted to financial gain
  3. We’re more vulnerable when we think we’re an expert
  4. People don’t like to back down from a long-term commitment
  5. We have a tendency to trust authority
  6. Scare tactics, well, scare us

I know this sounds cynical — and it is — but use your common sense, don’t trust anyone, if it seems too good to be true, it probably is and don’t be afraid to walk away if it doesn’t feel right to you. We’re all susceptible to a good con, so protect yourself and avoid scams that could ruin your retirement.

Click here to read more about how you can avoid scams that could ruin your retirement.

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2103 Retirement Resolution: Plan Your Next Chapter


When thinking about retirement, it’s easy to see it as the end of something: your working career. But it’s also the beginning. Chances are that you have a lot of good years left in you and retirement is also an opportunity to pursue a different path, so make this last 2013 retirement resolution: plan your next chapter.

Start now. Make this 2013 retirement resolution: plan your next chapter.

2013 retirement resolution: plan your next chapter

Whether you’ve saved a lot of money or just a little, your golden years are a perfect opportunity to take your life in a completely new direction and try things you’ve always wanted to, but never had the time. If you give it some thought, you can probably make money from your new adventures, too. And that’s never a bad thing.

Once your retirement finances are in place, you’ll also need a plan for how to spend your time in retirement. “Slowly start thinking about what you want your next chapter to be about,” says Marci Alboher, vice president of Encore.org.

Make a plan — or several. Be practical, but don’t limit yourself, either.

…do some experiments to test out your ideas. Volunteer for an organization in your neighborhood. Make some coffee dates with people who have used their retirement in meaningful ways.

Of course, you’ll probably never become a professional football player starting so late in life, if that was your dream, but there are lots of options that will allow you to be actively involved with the things you love, so add this last 2013 retirement resolution: plan your next chapter.

Click here to read more 2013 retirement resolutions.

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Scams Threaten Your Retirement Security


The elderly seem to be a prime target for scammers, who often pose as grandchildren in need of financial assistance. This approach has been around a long time, but it’s worth mentioning again because these scams threaten your retirement security.

Scams like the “grandchild in trouble” threaten your retirement security.

Scams threaten your retirement security

Grandchildren — and children — often need financial assistance and loving grandparents with the means to do so often help. This willingness to help out family members is the basis of a scam that can rob you of hundreds — or thousands — of dollars.

Carol Mahre said when one of her grandchildren is in trouble, there’s nothing she won’t do to help. That’s why when she got a call from a young man claiming to be her grandchild, she was determined to help.

“I get a call in the morning by this young man who said, ‘Hi grandma’ just like my grandson would do,” Mahre said. “And then he said. ‘I’m in Mexico and I’ve got a problem.’”

And that’s how it starts. Before you send your hard-earned retirement dollars to some foreign land, or even across the country, there are some simple things you can do to ensure you really are helping a loved one and not getting ripped off.
  1. If the person says they know you, verify their identity by calling them back on the number you already have.
  2. Never give out bank or credit card numbers.
  3. Be very suspicious of requests for money wires.

You can also call other family members to learn about the “grandchild’s” activities, before you send any money. Parents and siblings are sure to know where they are and what they’re up to. Scams threaten your retirement security, but you can avoid them with these simple steps and a good dose of skepticism.

Click here to read more about avoiding scams that threaten your retirement security.

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2013 Retirement Resolution: Get Your Social Security Statement


Most of us will be relying — perhaps heavily — on Social Security when we retire. To get an idea of what that will mean for you, adopt this 2013 retirement resolution: get your Social Security statement.

Make this 2013 retirement resolution: get your Social Security statement.

2013 retirement resolution: get your Social Security statement

Most workers will no longer receive a paper Social Security statement in the mail. But now people age 18 and older can access their Social Security statements online. Take a few minutes to check that your earnings history has been property recorded and familiarize yourself with your expected Social Security payout. “Delaying Social Security makes sense for most people if you can afford to do it, because the payout escalates enormously for every year you wait between ages 62 and 70. That’s a return that is really hard to beat by putting your own money to work.”

In addition to increasing your Social Security payments, working longer has the added advantage of more earnings and — of course — more savings for retirement, so make this 2013 retirement resolution: get your Social Security statement.

Click here to learn more about 2013 retirement resolutions you should make.

Click here to visit the Social Security Administration set up your online account.

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2013 Retirement Resolution: Save More


As we approach the new year, many of us will be contemplating the tradition of making new year’s resolutions. With that in mind, here’s the first of several resolution ideas to improve your golden years — 2013 retirement resolution: save more.

Make a new year’s resolution to save more for your retirement.

2013 retirement resolution: save more

Save 1 percent more.

Set your direct deposit to your 401(k) or IRA to be slightly higher next year. “I would increase the percentage 1 percent, and if, after three months, I am paying my bills and having a little fun, I would raise that another 1 percent,” suggests Gail MarksJarvis, author of Saving for Retirement (Without Living Like a Pauper or Winning the Lottery). “If I am getting a raise in the new year, my resolution would be to provide half of my raise to a 401(k) or an IRA before I ever take that pay home.”

Given the problems with 401(k) plans — like excessive management fees and the risk of systemic failure — you should also think outside the box, like increasing your mortgage payment by one percent or finding other investment options that really do diversify and protect your investments.

You deserve a great new year and a safe and secure retirement, so plan ahead and commit to this 2013 retirement resolution: save more.

Click here to read more about 2013 retirement resolutions.

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Retirees Should Understand the Dangers of Investment Fraud


The elderly have long been a prime target for “fraudsters.” Crooks are more brazen and knowledgeable than ever and most of us don’t have time to keep up with all the new ways someone else can illegally get our money. That’s why it’s so important that retirees should understand the dangers of investment fraud.

Retirees should understand the dangers of investment fraud.

Retirees should understand the dangers of investment fraud

It was just about four years ago that the epic cons of Marc. S Dreier, R. Allen Stanford and the mastermind Bernie Madoff crashed down around them, along with the world’s financial markets. What have we learned? Now “may be a good time to ask whether you have done all you can to lower your risk of being caught up in a similar fraud.”

Protecting yourself against fraud, or simply bad advice, is easier said than done. The most common advice is to make sure your money is held by an independent custodian or firm whose job is to keep your money safe. That wasn’t the case with either the Madoff or Stanford fraud. But that is only one small step.

Here are some other things to keep in mind to avoid having your retirement fund gutted by some unscrupulous con artist:

The first step would seem to be picking an honest adviser. The good news is that only about 7 percent of advisers have disciplinary records, said Nicholas W. Stuller, president and chief executive of AdviceIQ, a company that evaluates advisers.

Ross Gerber, president and chief executive of Gerber Kawasaki, a wealth manager, said clients with sizable wealth should not trust it to any single adviser, no matter how good the adviser seems to be.

Mr. Gerber added that he would steer clear of advisers who didn’t want to share with other advisers what they had done for clients. “If Starbucks goes from $50 to $80, it’s easy to show them why it did well,” he said. “When you’re investing in these scams, they’re funds. You don’t see what’s in them. People don’t necessarily ask a lot of questions or they don’t care.”

In some cases, investors do not even know the questions to ask. Marc Odo, director of applied research at Zephyr Associates, a financial software firm, said he had been asked by a client whether a return could be so high or consistent for so long that it might signal a fraud.

I can’t stress it enough: Learn about investing — after all, your retirement depends on it — ask questions and remember — if it sounds too good to be true, it probably is. The better retirees — and the rest of us — understand the dangers of investment fraud, the safer our investments will be.

Click here to read more about what retirees should understand about investment fraud.

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