- I’m 67 With $1.2 Million in a 401(k). Is It Too Late for a Roth Conversion?
Converting funds in a traditional 401(k) into a Roth IRA can provide you with tax-free retirement income, and there are no rule prohibiting conversion at any age. However, converting when you are close to or at retirement age involves some additional considerations. For one thing, you may have to let converted funds age for five… read more…
- Am I Too Late? I’m 65 and Only Have $120k Saved for Retirement
A low-savings retirement is one in which you don’t have enough money in your portfolio to generate a comfortable retirement income. For example, let’s say that you’re 65 and have $120,000 in a retirement portfolio. We’ll assume that this money is in a pre-tax 401(k). This won’t generate a livable income on its own. That doesn’t… read more…
- Does VA Disability Affect My Social Security Retirement Benefits?
As you plan for your retirement and financial future, you may wonder, does VA disability affect Social Security retirement benefits? Rest assured, VA disability benefits do not reduce the amount of Social Security retirement benefits you receive. VA disability compensation is considered an independent benefit and is not counted as income for Social Security purposes.… read more…
- What Is a Social Security Statement?
A Social Security statement is a document provided by the Social Security Administration (SSA) that outlines your earnings history and projected benefits. It serves as a comprehensive record, detailing your contributions to the Social Security system over your working life. By reviewing your statement, you can verify the accuracy of your earnings record and get… read more…
- I’m 60 and Make $150k. Should I Convert $50k per Year From My IRA to a Roth to Avoid RMDs?
There are plenty of ways to analyze your retirement strategy. Sometimes, when we have lots of concrete information, we can start by running the numbers. If X, then Y, and the next steps are to decide what risks and outcomes you’re comfortable with. But sometimes, the place to start is with questions. As you build… read more…
- A Comprehensive Guide to Planning for Retirement
When you plan for retirement, you’re preparing to one day leave the workforce. And you’ll need to decide how you’re going to pay for your living expenses after you’re no longer receiving a salary. It’s typically a decades-long process that begins with envisioning a desirable retirement, estimating what that will cost, and then amassing the… read more…
- Common Investment Advice to Consider for Retirement
Planning for retirement involves a few key investment strategies that can help ensure financial stability in your later years. The timing of your investments, the diversity of your portfolio, and your understanding of interest rates over the years are just some of the retirement investment advice you’ll need to seek out in order to fulfill… read more…
- Self-Directed IRA vs. Traditional IRA
Understanding the difference between a self-directed IRA and a traditional IRA can help you decide how and where to invest your retirement savings. A traditional IRA is a popular choice for many investors, offering tax-deferred growth on contributions made with pre-tax dollars. This means you don’t pay taxes on your investments until you withdraw them… read more…
- 13 Retirement Planning Mistakes to Avoid
Retirement planning is an important aspect of financial management that could help you ensure a comfortable and secure future. However, many individuals fall into common pitfalls that can jeopardize their retirement dreams. From starting too late to underestimating expenses, these mistakes can have significant repercussions. Understanding and avoiding these retirement planning mistakes can help you… read more…
- What Is a Self-Invested Personal Pension (SIPP)?
A self-invested personal pension (SIPP) is a type of pension plan offered in the United Kingdom that allows individuals greater control over their retirement savings by letting them choose and manage their investments. Unlike traditional pension plans, SIPPs provide access to a wide range of investment options. This flexibility can help tailor a retirement strategy… read more…
- Estimating How Much to Save for Retirement at 40
By age 40, you should have a clear plan for retirement savings. The first step is to evaluate your current savings and projected retirement needs. Experts often recommend aiming to have three times your annual salary saved by this age. This ensures a solid foundation as you continue to build your nest egg. You’ll also… read more…
- Retirement Plan Options in the United States
Retirement planning in the United States offers a variety of options tailored to meet different financial goals and needs. You’ll most likely be familiar with 401(k)s and IRAs, which are two of the more common options, but we’ll also take a look at SEP IRAs, SIMPLE IRAs and Thrift Savings Plans, among others. Choosing the… read more…
- 10 Signs That You’re Financially Ready to Retire
Determining when it’s time to retire involves recognizing key financial indicators that signal readiness. Signs that show you’re financially prepared include having consistent income streams, low debt levels, sufficient insurance and a robust retirement fund. Identifying them can help you make a smooth transition into retirement, offering you peace of mind and financial stability for… read more…
- I’m 62 With $1.6 Million in My 401(k). Should I Convert $160,000 Per Year to a Roth IRA to Avoid RMDs?
Converting your 401(k) to a Roth portfolio will allow you to entirely avoid RMDs. This is a legitimate form of tax planning. However, often there’s a difference between whether you can do something and whether you should; whether it’s allowed, and whether it’s in your long-term best interest. For example, say that you’re 62 years… read more…
- Should I Take a $250,000 Lump Sum or $2,750 Monthly Payments for My Pension?
Workers with defined benefit pensions may be offered the chance to collect a one-time, lump sum payment instead of monthly pension benefits for life. Making this decision involves evaluating a number of factors, including the lump sum amount, the amount of the monthly payments and the age of the recipient when the offer is made.… read more…
- How to Create an Investment Plan for the Retirement You Want
Before you can create an investment plan for the retirement you want, you’ll want to think about your desired lifestyle. By identifying your retirement goals early, you can tailor your investment strategy to meet your specific needs, such as travel, healthcare and daily living expenses. A sound investment plan not only helps in accumulating the… read more…
- When I Claim My $3,000 Social Security, Will My Wife Automatically Get a Spousal Benefit?
When you file for Social Security, your spouse becomes eligible for payments known as spousal benefits. However, they won’t receive these payments automatically. Instead, they must file with the Social Security Administration, whether they’re receiving their own retirement benefits or not. A financial advisor can help you plan for Social Security and build a comprehensive… read more…
- How to Make a 401(k) Hardship Withdrawal
Facing financial hardship can be an overwhelming and stressful experience, especially when it feels like your options are limited. You may consider a 401(k) hardship withdrawal as a potential solution to your immediate financial needs if you’re younger than 59 ½. However, before making this decision, you’ll want to fully understand what a 401(k) hardship… read more…
- How to Consolidate Your Retirement Accounts
Consolidating your retirement accounts can simplify your financial planning, reduce fees and provide a clearer picture of your overall savings. By combining multiple accounts into one, you can streamline your investment strategy, make tracking your progress easier and potentially enhance your portfolio’s performance. Whether you have 401(k) plans from previous employers, IRAs or other savings… read more…
- How to Save More for Retirement This Year
Saving for retirement is important because it ensures greater financial stability and independence in your later years. As life expectancy increases, so does the need for a robust retirement fund to cover extended healthcare costs, rising living expenses and unforeseen financial challenges. Without adequate savings, you risk outliving your money, which could lead to a… read more…
- What Are the Social Security Trust Funds?
The Social Security Trust Funds are financial reserves established to support the Social Security program in the United States. They comprise two separate funds: the Old-Age and Survivors Insurance (OASI) Trust Fund and the Disability Insurance (DI) Trust Fund. These funds are designed to ensure the payment of retirement, survivor and disability benefits to millions… read more…
- I’m 64 With $1.2 Million in a 401(k) and $2,800 Social Security Benefit. What’s My Retirement Budget?
For an average single person planning to stop working at 64, a $1.2 million 401(k) account and $2,800 Social Security benefit could provide enough income to make ends meet during retirement. Widely used guidelines suggest your annual income may be around $81,600, which may or may not be more than your annual expenses. Much depends… read more…
- How to Semi-Retire Early: 5 Steps to Know
The concept of semi-retirement offers a unique alternative that balances the desire for more leisure time with the benefits of continued income and engagement. Learning how to semi-retire early can open doors to a lifestyle that combines the best of both worlds: the freedom to pursue personal interests and the security of a steady, albeit… read more…
- How Do I Know When It’s Time to Retire?
Deciding when to retire is one of the most significant financial decisions you’ll make, and getting the timing right is important for the success of your nest egg. If you’re wondering “how do I know when it’s time to retire,” several key factors can guide you. Evaluating your retirement readiness involves assessing your savings, understanding… read more…
- Is It Wise to Convert 10% of My IRA into a Roth Each Year to Avoid Taxes and RMDs?
Roth IRAs are not subject to rules on required minimum distributions (RMDs), and qualifying withdrawals from Roth accounts in retirement are also free of federal income taxes. You can get those advantages for funds in your traditional IRA by transferring them into a Roth account. You’ll have to pay income taxes now on funds you… read more…