Retirement planning is paying yourself first. Whether you use a qualified plan or non-qualified plan you need to determine your tax bracket. And if you're investing in the market, you need to determine your risk tolerance. Plans have differing contribution limits, so you need to establish the amount of contributions, when will you retire and your life expectancy.
First of all, put money in tax advantage accounts. Deposit funds into Roth-IRAs, municipal bonds, life insurance policies and 529 college savings plans if you have kids. When clients open these accounts, they normally do not have to pay taxes when the money is withdrawn. Why? The client is contributing to these accounts with after-tax dollars. Next, protect yourself by obtaining disability insurance,long term care coverage, health insurance and buy life insurance. Clients need life insurance so that loved ones can pay the bills and have funds to provide for the family. The long term coverage will help just in case a client needs care in a nursing home.
Reduce your liabilities as soon as possible. Get out of debt and stay out of debt. Set aside at least three to six months of your monthly salary. There might be a change in employment, there might be an accident, or repairs to the home or car. Here is a brief overview that will help clients plan for retirement. Start early. For example, if you save $10 a day for 30 years and invest the money at 8% per year, you would have almost $450,000 for retirement. Moreover, if clients saved $20 a day for 30 years at the same rate, he or she would have almost $900,000 for retirement. This is why the concept of using tax advantage accounts is so important.
Here is a good rule of thumb when planning for retirement. According to the Financial Analysts Journal, "Americans need to save 22 times their income" to retire comfortably. What does this mean? Clients that make $40,000 a year, need $880,000 when they retire (i.e. $40,000 x 22). Keep in mind that this is only a tool to use that will help you with your retirement planning.
Finally, clients need to take into consideration their home mortgage balance(s), the kids college education costs and life insurance needs. I will be glad to help you meet your retirement planning goals. I listen to all my clients first. Then, we develop a plan and then we execute that plan. I can be reached at 912-631-3186.
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Reduce your liabilities as soon as possible. Get out of debt and stay out of debt. Set aside at least three to six months of your monthly salary. There might be a change in employment, there might be an accident, or repairs to the home or car. Here is a brief overview that will help clients plan for retirement. Start early. For example, if you save $10 a day for 30 years and invest the money at 8% per year, you would have almost $450,000 for retirement. Moreover, if clients saved $20 a day for 30 years at the same rate, he or she would have almost $900,000 for retirement. This is why the concept of using tax advantage accounts is so important.
Here is a good rule of thumb when planning for retirement. According to the Financial Analysts Journal, "Americans need to save 22 times their income" to retire comfortably. What does this mean? Clients that make $40,000 a year, need $880,000 when they retire (i.e. $40,000 x 22). Keep in mind that this is only a tool to use that will help you with your retirement planning.
Finally, clients need to take into consideration their home mortgage balance(s), the kids college education costs and life insurance needs. I will be glad to help you meet your retirement planning goals. I listen to all my clients first. Then, we develop a plan and then we execute that plan. I can be reached at 912-631-3186.