With the stock market appearing to head towards a–dare I say it–recession, now might seem like an odd time to talk about converting your traditional IRA to a Roth IRA. However, converting when the markets are low actually might be the best time to do so. When it comes to Roth IRA conversions, the tax bill for doing so is based on the value of your traditional IRA assets. Thus, when the markets are down, there’s a really good chance your IRA assets are down too, which means a lower tax number. As for the actual tax hit, as you Continue reading Have You Thought About a Roth Conversion?
When you transfer money between an IRAs or between a qualified retirement plan and an IRA, you’ve probably heard that the best way to do so is through a direct transfer. But do you know why that is? First off, it’s incredibly simple as the money never touches the hands of the account holder and goes from custodian to custodian (or from account to account). Another advantage of a direct transfer is that there is no limit on the number of transfers that can be done over the course of a year, unlike a 60-day rollover which you are limited Continue reading Why Direct Transfers are the Way to Go
Health Savings Accounts (commonly known as HSAs) can be a nice addition to your retirement savings plans. They can provide tax-free funds to help pay for your medically-related expenses–such as monthly medicaid premiums and doctor’s visits–and can also serve as an additional retirement account. Now, I want to follow up on that last part. I am not encouraging you to treat your HSA the same way you would an IRA or 401(k). Yes, you can take withdrawals from your HSA once you turn 65 for non-medical uses and only have to pay taxes on those funds. Depending on your situation Continue reading Including an HSA In Your Retirement Plans
Could you weather a financial emergency given your current savings? Where would the money come from to cover something such as unexpected medical bills or a necessary home improvement expense? In such situations it can be tempting to divert money ear-marked for your retirement savings towards those unexpected bills. Yes, such a move will provide short-term relief and provide you with the needed funds, but in the long-term impact can be quite substantial. First off, don’t forget that the money you don’t put into your retirement account won’t have an opportunity to grow (i.e. through investments) and won’t be there later, Continue reading Don’t Even Think About Stopping Retirement Plan Contributions
For many Americans, retirement is lived on a fixed income. That is, there is no income coming in and they are living off their savings. This means you will need to be realistic about your expenses and live within your means. While planning for retirement, aside from thinking about your expenses, you will also need to consider any debts you will have heading into retirement and what steps you can take to pay down those debts as much as possible. The key is that you enter retirement with as little debt as possible so that you don’t have to use Continue reading Get Down: Paying Down Debts Before Retirement
It can be easy to fall behind on saving for retirement. There are many expenses and costs that you will have to deal with during the early decades of your career which may require you to either save less than you would like to for retirement. While that isn’t anything to scoff at, it isn’t something you should lose sleep over. Why? Because once you reach a certain age, you will be able to take advantage of catch-up contributions. For example, if you are over the age of 50, you can put an additional $1,000 into an IRA each year, Continue reading Falling Behind on Retirement Saving? Take Advantage of Catch-Ups
It’s most likely that you won’t be able to predict who you fall in love with. With love’s unpredictability, it’s no surprise that there may be an age gap between partners in a marriage or relationship. That age gap can range from a few months to decades. Even if you and your significant other are only a year or two apart age-wise, you may still need to take that age gap into consideration when planning for retirement. If you are even further apart in age, say five or six years, you will need to be even more cognizant of the Continue reading Mind the Gap: What Age Gap Couple Should Consider When Retirement Planning
When it comes to saving for retirement, IRAs and 401(k)s get lots of love. They’re the two accounts that get talked about the most and, as a result, tend to be the most common accounts that people use when saving for retirement. While they are a great way to save for the future, they shouldn’t be the only accounts used when saving for retirement. Just like when it comes to investing, you should consider diversifying where you save your money for retirement. Yes, you should use accounts such as IRAs and 401(k)s to do so, but you should also save Continue reading When Saving for Retirement, Look Beyond IRAs and 401(k)s.
As you’ve saved for retirement, you’ve probably thought a lot about how much you will need for a comfortable retirement as well as how much you will spend each year in retirement. However, have you decided how much of your retirement savings you want to spend overall? It’s a valid question. Basically it comes down to how much you want left if your retirement account when you die. Some people seek amass large retirement funds with the intentions of having lots left over, which they can then donate to various causes or leave for family members. Others choose to leave Continue reading How Much Do You Want Leftover?