Top 10 Ways to Beat the Clock
and Prepare for Retirement
by Art Bernaducci
Investing in your own business makes sense. Many businesses achieve significant
growth each year. However, when you consider that many small businesses
fold every year, it becomes clear that banking your retirement solely
on the success of your business might not be the best idea. There is no
guarantee that your business will continue to grow or even maintain its
current value. If your business is worth less than you were counting on
at the time you planned to retire, you could be forced to continue working
or sell it for less than what you were expecting.
Know Your Retirement Needs
Retirement is expensive. Experts estimate that you’ll need about
70 percent of your pre-retirement income – lower earners, 90 percent
or more – to maintain your standard of living when you stop working.
(SSA)
Find Out About Your Social Security Benefits
Social Security pays the average retiree about 40 percent of pre-retirement
earnings. Call the Social Security Administration at 1-800-772-1213 for
a free Personal Earnings and Benefit Estimate Statement (PEBES). (SSA)
Put Money into an Individual Retirement Account
You can put up to $5,000 a year into an Individual Retirement Account
(IRA) and delay paying taxes on investment earnings until retirement age.
If you’re 50 years or older, you may contribute an additional $500
per tax year. If you don’t have a retirement plan (or are in a plan
and earn less than a certain amount), you can also take a tax deduction*
for your IRA contributions.
Contribute to a Tax-Sheltered Savings Plan
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. Over time, deferral
of taxes and compounding of interest make a big difference in the amount
of money you will accumulate.
Take Advantage of Employer’s Pension or Profit-Sharing Plan
If your employer offers a pension plan, check to see what your benefit
is worth. Most employers will provide an individual benefit statement
if you request one.
Ask Your Employer to Start a Plan
If your employer doesn’t offer a retirement plan, suggest that he/she
start one. Simplified plans can be set up by certain employers. For information
on simplified employee pensions, order Internal Revenue Service Publication
590 by calling 1-800-829-3676.
Don’t Touch Your Savings
Don’t dip into your retirement savings. You’ll lose principal
and interest, and you may lose tax benefits. If you change jobs, roll
over your savings directly into an IRA or your new employer’s retirement
plan.
Start Now, Set Goals and Stick to Them
Start early. The sooner you start saving, the more time your money has
to grow. Make retirement saving a high priority. Devise a plan, stick
to it, and set goals for yourself. Remember, it’s never too late
to start.
Learn Basic Investment Principles
How you save can be as important as how much you save. Inflation and the
type of investments you make play important roles in how much you’ll
have saved at retirement. Know how your pension or savings plan is invested.
Financial security and knowledge go hand-in-hand.
Ask Questions
Talk to your employer, your credit union or a financial advisor. Ask questions
and make sure the answers make sense to you. Get practical advice and
act now.
Get more free information at www.ArtBernaducci.com
or by calling (800) 433-3138.
Securities and Advisory Services offered through Ameritas Investment Corp
(AIC), Member FINRA/SIPC. and Platinum Financial Partners, LLC are not
affiliated.
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