It’s tough times out there for many Americans. We’re seeing record numbers of people filing for unemployment. For those who have lost jobs, it can be scary to think about where the finances will come from to continue paying things such as rent, mortgages, grocery bills, etc. Thus, during these times, it can be tempting to tap into retirement savings, especially if you have managed to build up a decent-sized nest egg. While I strongly, strongly discourage you from using your retirement savings to get you through these tough times, I realize that it may really be the only option Continue reading To Tap or Not to Tap Your Retirement Savings?
IRAs and 401(k) are incredibly popular employer offered retirement plans. Many employers currently offer them and with the recent passage of the SECURE Act legislation, even more small businesses and enterprises will be able to offer such benefits to employees. However, IRAs and 401(k)s do have contribution limits, which can be on the lower side–especially for IRAs. Thus, if you find yourself in a situation where you want to do some serious catching up (aside from making catch-up contributions) with your retirement savings or have a sudden windfall (i.e. an inheritance), you may need to look at opportunities to help Continue reading Looking to Grow Your Nest Egg Beyond an IRA or 401(k)?
According a recent Washington Post article, Fidelity Investments had 200,000 participants in the 401(k) programs it managed who had over $1 million saved up at the end of this year’s third quarter. That’s a 4,000 participant increase from the just the previous quarter. These numbers are quite inspirational as they show that it’s far from impossible to save a million dollars for retirement, which seems to be the magic number for the dream retirement these days. However, those retirement accounts didn’t reach seven figures overnight. No, it took years of diligent saving and smart investing. You too can strive to reach Continue reading So, You Want to be a 401(k) Millionaire?
The IRS recently announced retirement account contribution limits for 2020. The quick take away: 401(k) contribution limits are going up, IRA contribution limits stay the same, and just about all other retirement account contribution limits are also going up. Per usual, the increases are minimal. The 401(k) contribution limit is up $500 to $19,500, while the catch-up contributions will increase to $6,500 from $6,000 last year. IRA contributions remain topped out at $6,000 with a $1,000 catch-up contribution for those over 50. Contribution limits have been increasing just about every year in recent memory, so these should really come as Continue reading 2020 Retirement Limits: Some Things Go Up, Some Stay the Same
Life can be unpredictable. Do you know how you will handle that unpredictability? For example, if you were faced with a sudden, substantial medical bill or your home was damaged in a storm, do you know where the money to pay for those expenses will come from? If you’re financially savvy/smart, you probably have an emergency fund set aside to help with those expenses. However, if you don’t have such money set aside or the costs are more than your emergency fund, you may need to find other financial resources to tap into. While I strongly discourage it and will Continue reading Knowing How Hardship Withdrawals Work
Many companies offer retirement benefits. Those benefits can range from simply offering 401(k)s to a wide range of financial resources that can include financial planning and multiple retirement account options. Furthermore, with legislation working it’s way through Congress that could allow small businesses to band together to offer retirement savings plans, more Americans could find themselves working for an employer that offers such benefits. Regardless of the size of the company you work for, if you are taking advantage of any employer offered retirement benefits, you need to make sure that you understand what those benefits entail and what their Continue reading Do You Understand Your Employer Retirement Benefits?
Over the course of a career, you will probably have multiple retirement accounts. You’ll probably open a 401(k) plan with each employer along with a personal IRA. It can be easy to lose track of those accounts over a career that lasts decades, especially for early-career jobs that may not last that long. While it is suggested that you be diligent with tracking your retirement accounts after you leave a job, it’s not uncommon for accounts to be forgotten about. If you do lose track of your retirement accounts, there are tools available to try to track them down. The Continue reading Don’t Lose Track of Your Retirement Accounts!
Paying down your debts should be an important retirement savings plan. Yes, I know it’s not saving, but it’s vital to your retirement plans. First off, the sooner you pay off your debts, the sooner you can start diverting more money into your retirement accounts. That money going towards debt payments will be much more useful in an IRA or a 401(k). Secondly, your debts won’t go away in retirement and you don’t want them to eat away at your nest egg only you actually get to retirement. Also, keep in mind that debts often involve interest and that the Continue reading Pay While You Save for Retirement
You’re probably familiar with what a required minimum distribution (RMD) is, but do you know what a required beginning date (RBD) is? If you guessed that it’s the date that you begin taking your RMDs, then you are spot on. Knowing your RBD–and any associated options–can be almost as important as knowing how much you need to take out for your RMD. If you have an IRA, your RBD is April 1 of the year following the year in which you turn 70 1/2. There are no exceptions to that rule, unfortunately. However, if you have an employer plan (i.e. Continue reading You Know RMDs, But Do You Know RBDs?
Yesterday, I wrote about diversifying your retirement savings by having more than one type of retirement account. While such a concept is a good idea, it also needs to be done reasonably. While it’s okay to have more than one retirement account, it’s not a good idea to have multiple types of the same account or to have so many retirement accounts that you can’t keep track on them. If you find yourself in such a situation, you should consider streamlining your retirement accounts by doing a conversion or rollover so that you only have two, maybe three, accounts. Thus, Continue reading Organize Your Retirement Accounts Through Consolidation