FirenIce ?¸.•*´¯) asked:


I have $40,000 today toward my eventual retirement that will earn 14% interest over the period. I want to have $500,000 at at the retirement date. How many years away from retirement am I?

Crystal

Eric Bayne asked:


Many people, after having invested much of their money into a safe 401k fund, are ready to begin their retire with no money problems. But how many of them have actually taken the time to take a pen and calculator and begin to compute exactly how much of their monthly expenses that their 401k will actually cover? Many haven’t, and many are shocked when they find out how much of a shortfall they have.

Most people never take the time to map out a long term retirement strategy. For some reason, doing so never seems to rise to that level of importance. Sure they’ll save a little here and there and some may even have a structured savings plan where a certain amount of money is taken out of their paycheck weekly and deposited in a fund. But very few people go through the hard process of putting down in writing such basic facts as what age they plan to retire, how much money they’ll need when they retire, and how much money their fund will provide for them when they retire.

And that’s a big mistake. It’s also why when the big day finally comes, many new retirees will belatedly discover that their 401K and Social Security payments will not even come close to covering their monthly dollar outlays. So, unfortunately, at the age of 65 or whatever age they retired they discover that they have to go back to work – sometimes part time but sometimes full time – in order to make ends meet.

So, why does this scenario happen so often? And is it avoidable? To put it bluntly – it happens because they failed to make themselves a retirement plan. And yes, this situation is avoidable – if you don’t wait too late to start. So let’s start now.

Here’s a practical, easy way to at least begin to create a retirement plan. How much do you currently earn a month? Most experts figure that you’ll need at least 60 to 80% of your pre-retirement gross income to keep you at the same standard of living that you now enjoy. So let’s be conservative and figure that you’ll need 80% to be comfortable. So, if you make $4,000 a month, your retirement fund plus Social Security payments would have to provide you with at least $3,200 a month.

Now ask yourself. How much will your current 401k fund plus Social Security provide for you at retirement. Is it at least 80%? This part may take a bit of work on your part, but there are calculators all over the Internet that can help you to answer this question.

If you discover that your retirement fund as currently constituted will not provide you with this 80% of your pre-retirement gross income, you have one of two hard choices to make. You either make a conscious decision to lower your standard of living when you retire. Or, you make a conscious decision to increase the amount of money that will be in your fund when you retire. You can do this by either taking extra jobs and placing the excess money in your retirement account or by choosing more profitable investments. Whichever decision you choose, at least you won’t be going into your retirement years financially blind.

Now admittedly, this quick and dirty retirement plan analysis does not take into account many factors that a thorough analysis would. For example, we’ve left out factors such as whether your house has been paid off at retirement, whether you’ll still be supporting your children at retirement, and whether you have other substantial debt loads. And it’s more than worthwhile for you to map out a thorough retirement analysis plan as soon as possible. But even a quick and dirty plan such as this is more than most people do and is better than no plan at all which, unfortunately, is what most people have.



Esther

Tracey Anne asked:


Most of us are familiar with these statistics…

Out of 100 people who starts working at the age of 25, by the age 65:

* 1% are wealthy * 4% have adequate capital stowed away for retirement * 3% are still working * 63% are dependant on Social Security, friends, relatives or charity. * 29% are dead.

More Statistics on “The GOLDEN Years”

Retirement by the Governments own statistics:

* The average savings of a 50 year old in the U.S. is $2500. * 32 Million Americans are currently threatened with bankruptcy. * More than 1,000,000 [1 Million] filed for bankruptcy in the year 2000.

More Statistics…

Out of every 100 people who reach the retirement age of 65:

* 62 retire with less than $25,000 in assets and depend on Social Security or family for their retirement.

* Another 35 retire with less than $100,000, have some form of pension in addition to Social Security and are just making it in their retirement. If either Social Security or their pension went away they would have a very difficult time surviving.

* 2 of the 3 remaining retirees have an adequate pension or retirement account. They have assets of between $100,000 and $750,000. They do appreciate having the additional money they receive from Social Security, but could survive without it.

* The last of these 100 retirees, is the only one who is financially independent. This retiree has assets approaching or exceeding $1,000,000. They do not need the income from Social Security at all.

Which group above will you be in when it is time for you to retire?

Still More Statistics…

“According to recent Governmental statistics, most people are very concerned about their financial security in retirement. Over 70% believe they won’t have enough money put away for retirement. Of those between the ages of 30 and 54, almost 80% feel this way about their future.

One of the factors is the uncertainty of Social Security. In the mid 1970’s, 2/3 of the people surveyed said they were quite confident Social Security would be there for them when they retired.

In 1980, of those surveyed, 2/3 commented that they were not confident that Social Security would be there to support them in retirement. They felt that if Social Security was still a functioning service, it probably would not be paying an adequate amount to cover a reasonable standard of living.

So if this is the case… why aren’t people socking away hoards of money so they are not part of the statistics? Well, it seems that saving for retirement is a difficult task to master for the average person.

Some have difficulty saving on a systematic basis. With others, it’s often the case of having good intentions but very poor follow-through. Still others, it’s that they make poor selections with the saving and investment vehicles they choose.”

Clearly, the working-class scenario of toiling away building someone else’s empire for forty years, trying to accumulate wealth (money) so one can retire comfortably, is NOT working. Most people would like to retire with dignity. Wouldn’t you?

Have we shown you enough? Well, here’s a few more facts…

“The rising stock market and escalating property values, while adding general prosperity, hide the brutal fact that for many Baby Boomers-who are now turning 50, retirement may not be a pretty picture.

Over the next 20 years, 76 million of us born between 1946 and 1964 will hit 50. For most, that means facing up to the harsh questions of how, or even if, they will be able to afford to retire.

With meaty employment pension plans gone the way of ancient history, and Social Security increasingly becoming an uncertainty, the lifestyle of retirees is no longer leisure, golfing, fishing and travel. In fact, the lifestyle for many retirees may be continued work and “cans of Spam . . . and not Caviar and Travels.”

The latest Census Statistics show that only 1 out of every 10 Americans today, is financially prepared to retire when they reach the age of 65.

What about the Current Economic Situation?

As we know, the economy is teetering on recession, companies continue to lay off in great numbers. And, you may as well kiss true job security good-bye. It doesn’t seem to exist anymore.

And although you may be one of those that make it to retirement and manage to hang on to your job, according to the Bureau of Labor Statistics, at 65 only 5% have enough money to retire on.

And since the standard route of working a traditional job has failed for 95% of all Americans. Shouldn’t you be seriously RE-evaluating the traditional career job employment scenario and if it is going to get you to and take you through retirement financially sound?

Here’s the real kicker… You and most of the people you know are going to work for at least 30 to 40 years …. at jobs you ****… with bosses you ****… with commutes you ****… with hours that you ****. What a life – failing while you are miserable most of the time. Do you want to do this for the next 40 years?

So What Can You Do About It?

Well, one pro-active move you can make is to avoid common and costly retirement planning mistakes that could seriously jeopardize your future and the lifestyle you dream of for your retirement.

Mistake Number 1: Procrastination Mistake Number 2: Not realizing that you’ll need a specific amount of money to sustain you each month when retired. Mistake Number 3: Relying on the belief you’ll be able to draw FULL Social Security benefits. Mistake Number 4: The under-estimation of your medical costs if you are not in good health. Mistake Number 5: Not setting up your long-term-care insurance early. Mistake number 6: Making the assumption that you can retire early. Mistake Number 7: Getting into the false hope that in retirement you will be in retirement-mode. Mistake Number 8: Failing to seek expert financial and retirement guidance.

Start focusing on these commonly made mistakes and make sure you are not falling into the traps they can create. If you recognize some of them in your portfolio, get them fixed so you are on the right track. You don’t want any of them to affect your retirement planning and live-on income.

Start a pro-active plan NOW! If you want to be able to live financially stable now and into your “golden” retirement years, you need to make changes in the strategies you’re presently using. One other pro-active move you can make is to join the home-business boom. It is the next big trend. CNN reports that a new home based business is started in the United States every 11 seconds.

Why? Well because a new home based business offers a low start-up investment compared to a brick and mortar, or franchise business, low monthly overhead, and you can start part-time while still employed, and create time leverage, residual income, and tax benefits for yourself. Tax expert Sanford Botkin says that a home business can result in tax savings of $3,000 to $9,000 per year.

Follow this trend, however do proceed wisely – you don’t want to get into a situation where you are wasting time or money out of your pocket.

Make sure you do your research. You are looking for an income generating system that allows you to build substantial supplemental income, PASSIVELY; where you don’t have to give up your life, or your spare time to run it successfully.

You don’t want to be adding a lot of additional work hours to your day, otherwise, you might as well start commuting to a second job site.

Start now… remember, procrastination is mistake #1… That way when you do decide to retire, unlike the income earned at a job, which stops when the work stops, the residual income from your home based business will continue to pay you long after the work is completed. Leaving you to enjoy your retirement free and to the fullest.



Paul

Wayne Miller asked:


This is not a given for every employee. It used to be in the generation that was in the workplace of the nineteen fifties and sixties that staying with a company for thirty or more years and retiring with full benefits was the norm. That is not the norm any more.

We cannot just blame the job hopping ways of employees for the change of culture away from going for the gold watch and retiring in a company. From the corporate side, so many companies have eliminated retirement packages entirely that there is a strong belief of the do it yourself retirement in the working population.

A company offers retirement benefits for employees for one purpose. That is to aid with retention. When you have a pool of talented, well trained and energetic employees, that is a corporate resource. So if you can keep those employees all the way through to retirement, that is a real value to any corporate entity.

So if your company does offer these benefits to your employees, its important that you take advantage of them in more ways then just sponsoring them. A retirement package for aging employees sends a message to the employees that the company cares about them and about their families. And this may be true in your company that you have a corporate culture of being involved with your employees at a personal level and maintaining that we are family feeling for people who work for you. If that is the case, it makes sense that you would extend that feeling to care for the retirement planning of any employee that you have that shows signs of being a long term value to the company.

You should highlight the company retirement package as early as the interview with your prospective employees. Remember that an interview is about more than you looking for qualified people. It is also about qualify people interviewing you. And that is exactly where the value of a strong retirement package is of greatest value. If a job hunter who is looking for a place to work that they can retire at knows that you have a good plan to help them with their retirement planning, that will draw the brightest and best to your HR department.

Your HR department should not let the retirement issues of employees lie idle for very long at all. The more you help your employees plan for and participate in a retirement program, the happier they will be and the more engaged in their work they will be. Hold regular retirement planning meetings to have employees review their level of participation in the program. This is where you will put in front of the employees your most empathetic HR employees to show genuine interest in the employee retirement issues.

Above all be sure to show particular concern and caring for aging employees. And when an employee finally crosses over into retirement, throw a party and go out of your way not only for the company to help the employee transition to retirement but to demonstrate to all employees that the company lives up to its claims to be faithful to employees all the way into retirement. In an economy where so many companies throw people away, your employees will notice that this is not that kind of company. And your faithfulness to retiring employees will result in a rich crop of faithfulness from ongoing employees who stand behind you because you stand behind them from the day they start work in the company all the way through to retirement.



Frank

bobbalooee asked:


The company I work for uses AIG for their investment advisers. They match up to 3%. My question is should I rollover to another financial advisor or keep with AIG. I am have already lost 35% of my retirement and unhappy with what I have been reading in the papers about AIG. I know I should still contribute to AIG to receive my company match since its free money, but am not sold on leaving everything with them and watching the government continue to bail AIG out.

Jean

Riggy asked:


When should one start planning for retirement years and what is the best retirement plan?

Angela

one4Christ asked:


Does anyone know what (if any) are the penalties for withdrawing some or all of your retirement funds to use as a down payment to purchase your first home? I have a 457 retirement plan and I am considering pulling out $10K to go towards the purchase of my first home. Normally I would be penalized 30% but I heard somewhere that there are 3 circumstances where this is allowable without penalties. Can anyone vertify this is accurate or tell me where I can get more info.

Thank you!

Tyrone

Andy Rogers asked:


my colleagues realized how important was retirement planning when they themselves got retired, did they understand my wisdom. People would be idiots to not plan it earlier. It may seem tough at first to believe that one has to retire someday from the workplace and the sooner it is done the better it is for the life after retirement. Retirement planning is essential in order to be able to enjoy retirement. Most people have dreams for their retirement years and only planning will make it happen. The best time to begin retirement planning is as soon as a person has graduated from college and begins to work. Those people who begin early will find that their retirement years will be filled with the ability to do whatever they want or dream up.

Some people who don’t plan properly find retirement to be a night mare. But there are actually some good ideas to help plan for retirement. A great idea is to reserve a convenient optimum percentage of pay and place it in an investment account. Doing it this way means that the money isn’t missed and doesn’t become part of the monthly budget. Don’t expect that if the money isn’t taken out automatically that a person will have enough will power to do it on their own. Retirement planning isn’t easy and it takes determination and discipline to keep the plan together for years.

Taking advice form a retirement advisor is a good idea. He can make suggestions and advise of several significant things like opportunities to increase investments. As a person gets increases in salary or pay, keep the percentage of ten percent going to retirement planning. In doing this the person might also have the opportunity to possibly have early retirement. By retiring early a person will be able to spend more time doing all the things they have dreamed of. It doesn’t mean that life stops. Because of all these reasons, retirement planning is essential for later on in life.In the same way that as a child one learns how the ants and birds work hard for the winter to come, it is important to have instilled inside a person a good work ethic.

Prior planning is going to have long term benefits. It feels so good after retirement when you see the fruits of your planning endeavors ripe. A person will be glad that they spent the time doing retirement planning. They will be proud of the fact that they had self discipline to keep it up over the years. For those people not at retirement age it’s never too late to start preparing and if one sticks with the plan, retirement can still be filled with the opportunities to fulfill dreams someday.Retirement planning should never feel like a chore because it is a means to have a great time in the golden years of life.



Sandra

kriminyjicket asked:


My husband has no retirement plan with his employer and are there companies out there retirement companies that offer plans for the individual. If so, then what are some good companies to have a retirement plan through.

Allison

Tha tru hustla asked:


Im in my early twenties and I just started working after finishing school, but I do want to start a retirement account. What source or foundation should I use for a retirement account?

Im pretty dumb in this area. Is a savings account through a company like ING Direct bad for a retirement account?

Annette