Tips for Planning your Retirement by Corliss Law Group
CORLISS LAW GROUP
Tips for Planning your Retirement
Here are the top 10 things you need to know as you plan for retirement.
1. Save as much as you can as early as you can.
Though it's never too late to start, the sooner you begin saving, the more time your money has to grow. Gains each year build on the prior year's -- that's the power of compounding, and the best way to accumulate wealth.
2. Set realistic goals.
Project your retirement expenses based on your needs, not rules of thumb. Be honest about how you want to live in retirement and how much it will cost. Then calculate how much you must save for retirement to supplement Social Security and other sources of retirement income.
3. A 401(k) is one of the easiest and best ways to save for retirement.
Contributing money to a 401(k) gives you an immediate tax deduction, tax-deferred growth on your savings, and -- usually -- a matching contribution from your company.
4. An IRA also can give your savings a tax-advantaged boost.
Like a 401(k), IRAs offer huge tax breaks. There are two types: a traditional IRA offers taxdeferred growth, meaning you pay taxes on your investment gains only when you make withdrawals, and, if you qualify, your contributions may be deductible; a Roth IRA, by contrast, doesn't allow for deductible contributions but offers tax-free growth, meaning you owe no tax when you make withdrawals.
5. Focus on your asset allocation more than on individual picks.
How you divide your portfolio between stocks and bonds will have a big impact on your long-term returns.
6. Stocks are best for long-term growth.
Stocks have the best chance of achieving high returns over long periods. A healthy dose will help ensure that your savings grows faster than inflation, increasing the purchasing power of your nest egg.
7. Don't move too heavily into bonds, even in retirement.
Many retirees stash most of their portfolio in bonds for the income. Unfortunately, over 10 to 15 years,
Tips for Planning your Retirement
Here are the top 10 things you need to know as you plan for retirement.
1. Save as much as you can as early as you can.
Though it's never too late to start, the sooner you begin saving, the more time your money has to grow. Gains each year build on the prior year's -- that's the power of compounding, and the best way to accumulate wealth.
2. Set realistic goals.
Project your retirement expenses based on your needs, not rules of thumb. Be honest about how you want to live in retirement and how much it will cost. Then calculate how much you must save for retirement to supplement Social Security and other sources of retirement income.
3. A 401(k) is one of the easiest and best ways to save for retirement.
Contributing money to a 401(k) gives you an immediate tax deduction, tax-deferred growth on your savings, and -- usually -- a matching contribution from your company.
4. An IRA also can give your savings a tax-advantaged boost.
Like a 401(k), IRAs offer huge tax breaks. There are two types: a traditional IRA offers taxdeferred growth, meaning you pay taxes on your investment gains only when you make withdrawals, and, if you qualify, your contributions may be deductible; a Roth IRA, by contrast, doesn't allow for deductible contributions but offers tax-free growth, meaning you owe no tax when you make withdrawals.
5. Focus on your asset allocation more than on individual picks.
How you divide your portfolio between stocks and bonds will have a big impact on your long-term returns.
6. Stocks are best for long-term growth.
Stocks have the best chance of achieving high returns over long periods. A healthy dose will help ensure that your savings grows faster than inflation, increasing the purchasing power of your nest egg.
7. Don't move too heavily into bonds, even in retirement.
Many retirees stash most of their portfolio in bonds for the income. Unfortunately, over 10 to 15 years,