Retirement Finances

Planning for your retirement finances is a key component of your personal financial plan. There are many tools available to help you increase your retirement finances.

Your 401K May be Your Largest Income Producer in Retirement
If you are in the workforce and your company has a 401K plan your first step is to get involved with that plan and contribute as much as you can afford to contribute. This will have a tremendous impact on your finances. Most plans have a matching component up to a certain percentage and I urge you to contribute up to that percentage if at all possible. Otherwise you are missing out on free money. There are many plans that contribute 50% on the dollar up to 6% of your annual salary. Imagine you put in $500.00 the company puts in $250.00 plus you earn interest on the money, it's hard to find that kind of return on your money anywhere else.

An IRA is a Great Substitute for A 40K If You Don't Have Access to a 401K
There is also IRAs that allow you to contribute tax free dollars and the government will allow a tax deduction if you meet certain criteria (see your tax professional for details). The IRA helps you because it allows you to receive payments for the rest of your life if you choose that option.

If You Don't Like The 401K or The IRA An Annuity May Be For You
If you don't have access to a 401K plan and you don't like the IRA then you may want to consider an annuity. An annuity is another tax advantage vehicle that allows you to invest your money before taxes as long as you meet certain criteria (consult your tax professional for details). An annuity gives you options to receive payment at retirement either in a lump sum or life time payments. This is a decision you can make based on your tax status at retirement time.

An Estate Plan Ensures That Your Heirs Receive Their Fair Share of Your Estate
Also a big part of your retirement finances is estate planning. It’s important that you have an estate plan so your heirs receive their fair share of the assets you worked so hard to accumulate. It’s important that you have a will in place maybe a trust or even some type of entity so you can transfer ownership of the property while you are alive and still maintain control during your lifetime. This is important because if not done properly your estate can be subjected to unnecessary taxation, probate that could delay the transfer of assets as well as cause your heirs to incur unnecessary legal expenses.

Life Insurance is a Necessary Part of Your Financial Plan
Finally a big part of your retirement planning is life insurance. It’s important that you have life insurance to take care of your final expenses and possibly maintain you family’s standard of living. The last thing you want to do is leave your love ones with debt and no income to cover the debt.

The Retirement Bible An Excellent Resource for Retirement Finances