I am 49 years old and I am just now in a position to start putting away for my retirement. What would be the most logical and beneficial route for me at this point?
RETIREMENT, RETIREMENT PLANS
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March 2016
55% of people found this answer helpful
Here are some suggestions that may help you get started
Nest Egg Guru Retirement Saving Calculator
Hope this information is helpful.
Aloha,
JR
- At an absolute minimum, contribute at least as much of your income to employer sponsored retirement accounts (e.g. 401(k) plan) to fully receive any emlpoyer matching contributions.
- Since you are starting late, you may wish to plan on working beyond normal retirement age. It is not uncommon for people to work to age 70 or longer. This is made easier if you like your job. :-)
- Save as much as you can as early as you can, and take advantage of pre-tax savings retirement accounts. The links below provide the contribution limits for IRAs and qualified retirement accounts. When you turn 50, the IRS permits additional "catchup contributions" to provide an incentive for people who are behind in saving to contribute even more to their retiremetn accounts.
- Develop a disciplined plan. This begins with quantifying your goals. For more on this, see the following links -
Nest Egg Guru Retirement Saving Calculator
Hope this information is helpful.
Aloha,
JR
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March 2016
54% of people found this answer helpful
Getting started so late in the game means your best strategy might be to lower your expected retirement expenses first. I'd make sure ALL your debts are paid off first.
If you have no debt (except maybe a mortgage), you should have plenty of cash flow to save for retirement. First, take advantage of any matching your employer might offer. After that, whether you should put it in a Roth where withdrawals are tax-free, or a pre-tax account like a 401k or traditional IRA depends largely on your tax bracket now versus retirement. If you pay more tax now than you will in retirement, you're better off putting it in a 401k or traditional IRA. If you'll pay more tax in retirement, you're better of putting it in a Roth.
Starting at 49 you should probably be saving a minimum of 25% of your income, maybe closer to 40%. if possible. But am much as possible.
You'd also benefit from becoming a student of investments. Check out books like Automatic Millionaire and The Boglehead's Guide to Investing and see what other DIYers are doing. Alternatively, you could hire a professional to help you. Good luck.
If you have no debt (except maybe a mortgage), you should have plenty of cash flow to save for retirement. First, take advantage of any matching your employer might offer. After that, whether you should put it in a Roth where withdrawals are tax-free, or a pre-tax account like a 401k or traditional IRA depends largely on your tax bracket now versus retirement. If you pay more tax now than you will in retirement, you're better off putting it in a 401k or traditional IRA. If you'll pay more tax in retirement, you're better of putting it in a Roth.
Starting at 49 you should probably be saving a minimum of 25% of your income, maybe closer to 40%. if possible. But am much as possible.
You'd also benefit from becoming a student of investments. Check out books like Automatic Millionaire and The Boglehead's Guide to Investing and see what other DIYers are doing. Alternatively, you could hire a professional to help you. Good luck.
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March 2016
54% of people found this answer helpful
First, we need to make sure you have enough of your assets positioned appropriately before investing. Adequate amount of assets in emergency funds (checking or savings account - 6 to 8 months to cover unexpected expenses). The next step is to determine if your employer matches employee contributions. If they match, take full advantage of the matching opportunity. Employer matching is like free money and no one can beat free money. Next, if your income limits qualify look into establishing a Roth IRA. A Roth IRA is a great way to generate tax-free income during retirement.
Then take a look and see if you can fully max out your available qualified plans. The longer you wait the more difficult it will become to save for retirement.
Then take a look and see if you can fully max out your available qualified plans. The longer you wait the more difficult it will become to save for retirement.
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