Free Retirement Planning Tips

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Re: Saving money for retirement

It’s never too late to start saving money for your retirement. The sooner the better though. The earlier you start saving the earlier you get to start enjoying the benefits of compound interest. As 2007 comes to a close and 2008 jumps out at us, start making your New Year’s resolutions that will benefit you for many years to come - especially in your retirement.

If you have not started investing in your company’s 401k plan, do so now. Make an appointment with your HR manager to get you the paperwork you need to start automatically investing in your 401k. If your company offers a matching contribution of whatever you put in then make sure you invest the maximum amount they match. If they match 3%, at a minimum you should put in 3%. If they match 6%, then you must at least invest this amount. You are literally giving away free money with each passing paycheck if you do not take advantage of the company’s 401k matching program.

Using the company’s 401k match can mean the difference in you eating at McDonald’s in your retirement or eating at Chris Madrid’s in your retirement. Those burgers are awesome. If you’re not familiar with Chris Madrid’s, if you’re ever in San Antonio check them out. Great burgers.

Anyways, back to my point. You can save a lot of money effortlessly for your retirement by just investing in your company’s 401k so do it as soon as possible.

If you’re already enrolled then think about increasing your contribution by a percentage point or two. Then once you max out your 401k, it’s time to start thinking about an IRA. They can automatically withdraw this from your paycheck and put it into an IRA and invest it in stocks and bonds of your choosing.

Don’t forget about long term care and life insurance. Millions of people will need long term care as they get older. The earlier you buy it, the cheaper it will be for you. And you do not need to be rich to invest in long term care insurance.

Another thing to keep track of is your Social Security benefits statements. You should get these every couple years and they indicate approximately how much you should expect when you begin to withdraw from Social Security. Make sure the incomes reported on these are the same as what you actually make. You want to make sure, your full income gets reported so you get the full benefit of Social Security you’re eligible for.

One last thing is to look for opportunities to make more money so you can save faster and possibly even retire sooner. There’s nothing like the feeling of being able to retire early. You should do it just for the looks your coworkers will give you. :o)

Keep these tips in mind as you start planning your goals for 2008 and for your future retirement.

Here’s to a healthy, happy, and prosperous New Year!

-Adam

Free Retirement Planning Tips

The basics of 401k Plans

You must have heard of 401(k) Plans right? Not clear what exactly it is and how well it works? Here’s a brief explanation of the features of the plan along with its functions.

What is the working procedure of a 401(k) Plan?

In a very simple language a 401(k) plan is a retirement plan setup and managed by your employer. You get to choose from a selection of investment funds based on risk that you would like to invest in. It is at your discretion to choose the specific investment fund you would like to invest in. You then indicate what percentage of your paycheck you would like to contribute to your plan each paycheck.

Once this amount has been decided by you, it will directly get deducted from your paycheck but without being taxed for it at that moment. There is a specific limit up to which you can contribute to your account. Some employers offer a matching program where they will match dollar for dollar of 50 cents on the dollar for each amount you set aside up to a certain limit - say, 3-6%. This is free money you should take advantage of.

When do you go for a 401(k) Plan?

It is never too late to start investing in your company’s 401k plan. The sooner the better. The sooner you start, the more you will have available to draw from when you retire.

What to invest in your 401k?

This is always a tricky issue because you are ultimately responsible for what you invest in and if a company or financial adviser or friend gives you advice and the returns are not to your liking, they do not want to be liable in this sue-happy society.

The general idea is that you should invest in the riskier investments the longer you have until you retire. More risk = more reward over the long term and since you would have several years to weather the ups and downs of the market you could go for the riskier options. If you have a few years until you retire, you would want to stick with more conservative funds to preserve your investments.

Consult your financial adviser for specific advice. You can also check out sites like Fool.com for more advice.

How to get an 800% Return on Investment on your money

If you could trade $1 and get $8 worth of goods and services back, how many dollars would you invest?

If you could preserve your retirement savings for one tenth of the cost then why wouldn’t you want to learn more about it?

More and more people are being blindsided by this often forgotten cost that sneaks up on people and wipes out their retirement savings in a few years instead of it lasting for 20-30 years - the length of the average retirement.

So what is this cost that if you get it you can get a 800% ROI on your money?

Health insurance, long term care insurance to be more exact.

With the rocketing costs of health care and nursing homes, millions of baby boomers need to plan to pay for health care and assisted living.

If you plan ahead, you can avoid shelling out all your retirement savings on health care.

In order to protect yourself, you should look into long term care insurance. Long term care insurance can help you preserve your assets and take care of you in your latter years of your retirement. And no, long term care is not just for nursing homes, it also includes home health care where you can have your own nurse or CNA help you perform your daily activities.

And, long term care insurance is not just for “rich” people. Anyone who has a retirement income of over $35,000 should look into long term care.

Learn more about long term care insurance - get a free guide to long term care insurance that answers all your questions about long term care. Get the facts about how you can protect yourself from rising health costs.

How much money do you need to retire?

I found this short video from Terry Savage with a few tips on getting your “Savage” number - how much you need to retire.

She also provides a couple useful retirement planning links.

-Adam