Black EOE Journal www.blackeoejournal.com 43
Retired
Whether youre ready to enjoy your hard- earned retirement or plan to work part-time, you want a strategy to avoid outliving your sav- ings. The money you have saved and invested will be earning income until you withdraw it. Deciding how to handle your money will help you pay less in taxes on the money you take out and continue growing the money you leave in, so it can last your lifetime: As youre withdrawing money to pay your bills in retirement, you should try to grow your remaining funds to at least keep up with - and preferably beat - inflation. You may want to seek the help of a professional, especially later in retirement, when you may have less ability to keep your strategy on target. By law, good inancial professionals must be transparent and open about their fees and whether they are paid by commissions or for selling products like annuities and mutual funds. Be aware of scams. Become an informed investor - if it sounds too good to be true, it probably is.
Source: Department of Labor
You will need to replace approximately
80-90%
of your pre-retirement income to cover expenses [during retirement]."
-Debra Golding mutual funds, IRAs or other investment vehicles. Be realistic about investment returns. Never assume that a year or two of high market returns will continue indefinitely. The same goes for market declines. If you change jobs, keep your retirement account money in your former employers plan or roll it over into your new employers plan or an IRA.
New Workers
New workers may have more debt (think student loans) or other financial constraints but beginning to save now is critical because com- pound interest will allow those savings to grow over time. Follow these recommendations for new employees: Create a budget and find money that you can put aside for saving. Take advantage of your employers retirement saving plan. Its OK to start small! Even setting aside a small portion of your paycheck each month will pay off in big dollars later. Learn about your investment options. You can afford to invest more aggressively, which can have higher returns. Get started! Start the saving habit early - get time on your side. You will need to save a lot less later. Leave your retirement savings in the plan. When you change jobs or think you need some extra money - resist the temptation to cash out your account. Instead, watch it grow.
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