Fantastic Tips for large 401k maximum contributions!
May 6, 2009
The time to start the retirement planning process was yesterday. With Social Security being threatened and more and more baby boomers reaching retirement age, government funds meant to assist you during the golden years will become less and less available or be gone altogether! This is one of many reasons why a good plan is absolutely necessary if you are reaching 65.
When you start the planning process, it’s a good idea to focus on your goals and ask yourself some key questions. Consider how much you will need to live comfortably when retired. The word “comfortably” is key.
Then, consider consistent 401k maximum contributions. This can be tough, I know. There’s a lot of debate going on right now over a roth IRA vs 401k plan. The cost/benefit of each depends entirely on your financial situation and what you think will happen in the future.
Do you think that taxes will go up in the future? If so, then a traditional 401k plan is not going to be the best option. If you believe that taxes will go down in the future, then the 401k plan will probably produce decent results for your investments.
If you’re used to eating out or going on vacation, you have to consider that when figuring out how much money you’ll need later - or RADICALLY adjust your lifestyle (not easy to do). Also plan on how long you’re going to be retired. Twenty years ago, once you reached retirement age, you were only retired about 10 years before your expected death.
With medical advancements, many folks live long lives. So, if you don’t plan out far enough, you will run out of money and possibly be a drain on the rest of your family. Think about your goals for retirement.
If a job or financial burdens have kept you from doing some of the things you’ve always wanted to do, such as travel, then research how much you’ll need to have each month in order to attain that goal of an excursion to Europe, Asia, or a simple road trip in a motor home.
If health is a concern for you or your spouse, consider what you may need to set aside for nursing care or residence in an assisted-living facility. Are you going to plan for unforeseen expenses, medical bills, long-term care, etc.?
After you’ve done some calculating, it’s time to figure out which financial products will help you accomplish your goals. If you’re starting your retirement planning at a late age, you may need to choose products that will require you to assume more risk but allow you to acquire the funds you’ll need more quickly.
Many folks find that doing even the basics can be overwhelming. Don’t be overwhelmed. Contact a professional financial planner if you are ready.
Take care about your retirement! Make it stable with forex investments!
Tags: retirement planning
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