Retirement Planning

Saving For Retirement

"When to start, how much to save, and in what type of account?" are the decisions we all need to make when saving for retirement. And where in the order of priorities does it fall when also considering buying a home, sending the kids to college, or starting a business. During our working years, take a portion of your paycheck and send it via direct deposit into a separate, special account. If you don’t see it, you might not miss it. As this money accumulates, move it to more long-term investments consistent with your risk profile and time horizon. With all these goals, retirement especially, time is your friend. Properly invested, money has the opportunity to grow. Do you know your retirement target and if you may have shortfalls? Use of a retirement calculator can help, and using a financial advisor can assist you in determining your best retirement savings strategy.

Shifting investment styles

When you’re just starting to save and invest for your retirement, you may be like many people: comfortable accepting greater volatility and risk for the possibility of greater gain. As you approach retirement, you may have far less tolerance for ups and downs. Investors tend to shift to more conservative decisions, because losses just prior to retirement can be challenging -- and leave you little time to make it up with some unknown future gain. Prior to shifting your investment styles it's important to understand your current asset mix.

When should you retire?

This can be a complicated decision, and it’s certainly a personal one. After a lifetime of work, are you financially and emotionally prepared for this new time of life? The fact is, you’re in control of the big decision, and you can be confident you’ll make the right one, especially if you’ve done your preparation and homework. Review your asset and liabilities to help you determine your net worth which could help you with your decision. You can also use this calculator to help you determine whether you are saving enough to cover your expenses in retirement. Talk to a Financial Professional located at your credit union to ask your questions.

Living In Retirement

Making your money last.

The key to a comfortable and successful retirement is not outliving the money you’ve saved by creating a budget. Be careful with credit cards and new debt. Claim that senior citizen discount wherever it’s offered. Read the fine print about taxes on all your investments. You can also use the depletion calculator to help you determine which distribution option is right for you.

Be strategic about Social Security.

Social Security is available to you at age 62, but it’s great if you can wait. Take it early, and you get 25% less than if you wait until full retirement age at which time you’re entitled to 100%. If you can wait until 70, you get 35% more. People often coordinate Social Security benefits with spouses who are also eligible. Maybe one of you takes benefits early, and the other waits. Visit ssa.gov for more information about social security or use our social security calculator to help you estimate your social security benefit.

Tapping your retirement plans.

You may have a defined benefit pension plan from a former employer. Your 401(k) and perhaps IRAs will also likely play a central role. It’s your choice when to withdraw funds from these accounts. If you want to begin tapping them or simply want to roll them over somewhere else, make sure you understand all your options and the ramifications of every decision as well as the minimum distribution amounts. Distributions from traditional IRAs and 401(k) plans are required as you reach age 72. A Financial Professional located at your credit union help you develop a plan that is unique to your own lifestyle.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.

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