About Retirement Planning

Reminder: No required minimum distributions (RMDs) necessary in 2009

2009-11-25T08:35:05Z

If you're going to see any relatives over 70 1/2 this week (for example, at a family gathering tomorrow), you can remind them there are no required minimum distributions necessary for 2009. Ordinarily, folks over 70 1/2 must begin taking money out of their qualified retirement plans, such as their IRAs or 401(k)s. Furthermore, they must continue doing so each year. However, due to the stock market free-fall of late 2008 and early 2009, Congress passed a one-year exemption from the requirement so that the elderly wouldn't have to sell their shares while prices were down.

In 2010, required minimum distributions come back, so this appears to be a once in a lifetime opportunity for those not needing the money, to keep it in their retirement accounts, tax-deferred, just a little longer.

Reminder: No required minimum distributions (RMDs) necessary in 2009 originally appeared on About.com Retirement Planning on Wednesday, November 25th, 2009 at 08:35:05.

Permalink | Comment | Email this

How much do you need to retire?

2009-11-20T07:21:07Z

Next week is Thanksgiving and I'm already looking out for you. After discussing the weather, the kids, your boss, and the weather again, you're going to need something to talk about with those people (technically, family) while the turkey is still not ready.

Why not bring up the question of how much money you need to retire? It should start a pretty good conversation. Answer here first, then note the different opinions:

How much do you need to retire? originally appeared on About.com Retirement Planning on Friday, November 20th, 2009 at 07:21:07.

Permalink | Comment | Email this

Your health in retirement

2009-11-18T16:19:41Z

I just finished a fascinating read, titled Retirement Brings Most a Big Health Boost. Recent research found that 98% of retirees polled in Europe reported greater health in the years following retirement than in their final working days.

The degree to which this surprises you, I suspect, is based primarily on your current perception of your health and your personal job satisfaction. Still, what are the takeaways?

If you're about to retire and complaining about health, good news appears around the corner. On the other hand, make sure you do what you can so that you can reach that finish line as soon as you'd like.

If you're already retired, be sure to take advantage of any increase in available time by picking up or continuing those important healthy habits. Your younger years are your most active and most healthy - generally true in life and probably true of a retirement, particularly an extended one.

Your health in retirement originally appeared on About.com Retirement Planning on Wednesday, November 18th, 2009 at 16:19:41.

Permalink | Comment | Email this

The high unemployment rate and your retirement plan

2009-11-13T07:24:52Z

With the recent realization that the national unemployment rate is now over 10%, the importance of financial planning may never have been higher. While an optimist could point out that nearly 90% of the workforce is employed, his friend could note the many people who have stopped looking for work or are considerably underemployed. Critically, both of those groups are not counted in the unemployment statistics.

Still, I think there's a retirement planning lesson here: each individuals unemployment rate is either 0% or 100%. If yours is 100% (i.e., you're currently unemployed), you're very grateful if you saved previously. If you're currently employed with a decent job, count your blessings and be sure you're taking care of you and your family's future by saving today.

The high unemployment rate and your retirement plan originally appeared on About.com Retirement Planning on Friday, November 13th, 2009 at 07:24:52.

Permalink | Comment | Email this

2010 IRA Contribution Limits - No Changes

2009-11-11T13:20:09Z

Like many other retirement planning numbers, the 2010 limits for IRA contributions will be unchanged from 2009. Still, opportunities exist, including the higher contribution limit for those 50 or older and spousal IRAs. Because of their tax advantages, IRAs and Roth IRAs represent some of the best opportunities for you to become financially comfortable in retirement. Learn more about the 2010 IRA contribution limits.

2010 IRA Contribution Limits - No Changes originally appeared on About.com Retirement Planning on Wednesday, November 11th, 2009 at 13:20:09.

Permalink | Comment | Email this

2010 401K contribution limits to be unchanged

2009-11-06T08:58:29Z

Although the formula which determines how much the 401k contribution changes each year would have led to a $500 decrease in the permissible 401k savings level, the IRS has decided to permit the limit to remain unchanged. Largely to help companies and service providers from various software modifications, the limits will be the same as 2009's limit.

Read more about your 2010 401k contribution limits, including the catch-up provisions.

2010 401K contribution limits to be unchanged originally appeared on About.com Retirement Planning on Friday, November 6th, 2009 at 08:58:29.

Permalink | Comment | Email this

Don't take your 401(k) money when you switch jobs

2009-11-03T08:30:39Z

As was recently reported, Half of workers changing jobs cash out 401k when they terminate employment. Among workers in their twenties, 60% distribute the entire balance, according to the Hewitt Associates study. Short of needing money for basic essentials like food and shelter, taking money from your retirement plan is not a good idea. Not only do you lose the benefit of the likely significant growth over the rest of your working career, but you also forgo the tax-advantaged nature of that growth. Furthermore, because of the significant taxes due upon the 401(k) distribution plus the likely penalty for early withdrawal, you'll wind up with a check much smaller than the amount of money you remove from your plan. A far better option is a rollover IRA, where your money can grow for many years in the future. There are many benefits to an IRA rollover. In this case, just because most people are doing it (taking the money), really means you shouldn't.

Don't take your 401(k) money when you switch jobs originally appeared on About.com Retirement Planning on Tuesday, November 3rd, 2009 at 08:30:39.

Permalink | Comment | Email this

New IRS resource for owners of small businesses

2009-10-30T11:27:44Z

The Internal Revenue Service (IRS) recently unveiled a new guide for retirement planning oriented at the small business community. This robust web site features information on various self-employment plans including 401(k) plans, SEP-IRAs, and SIMPLE-IRAs. Loaded with links, the web site, called IRS Retirement Plans Navigator, is a great place for additional details for those in charge of assisting small business owners with their own retirement planning as well as those of their employees.

New IRS resource for owners of small businesses originally appeared on About.com Retirement Planning on Friday, October 30th, 2009 at 11:27:44.

Permalink | Comment | Email this

Maximize your 401(k) match

2009-10-22T10:52:54Z

Although 2009 is about to wind to its inevitable conclusion, you might still be able to get your money's worth from your corporate retirement plan account, like a 401(k) plan. Almost all employer-based retirement plans that featuring matching provisions calculate their maximum employer match based on a per-calendar year period. Therefore, even if you had previously neglected to take full advantage throughout 2009, by aggressively contributing to your 401(k) plan between now and the end of December you may be able to receive as much of that "free money" as you would have had you been contributing all year long!

However, once January 2010 rolls around, 2009 is gone and the money you forfeited can never again be realized. So if you've been procrastinating saving for retirement, you've only got a few weeks left to save - and potentially make up for the whole year.

Maximize your employer 401(k) matching program today.

Maximize your 401(k) match originally appeared on About.com Retirement Planning on Thursday, October 22nd, 2009 at 10:52:54.

Permalink | Comment | Email this

Learn more about your corporate retirement plan

2009-10-19T08:11:58Z

I recently attended a conference in New York City featuring some leading financial services technology providers. For my retirement planning audience here at About.com, one seemed immediately worth sharing: Brightscope.

Free for consumers like you to use, Brightscope allows for a "Morningstar-like" visibility into your corporate retirement plan. While not every plan has been analyzed, the database is already quite extensive and continues to grow. Use the database it to compare your current employer's plan to an old plan or even, one day, to a potential new employer's plan.

Information is power and Brighscope is doing a great deal of work to increase transparency in your fund options and fees. Given that you often have very little say as to what you are offered, this is an important initiative.

Remember, you are the eventual retiree to whom the burden of retirement has, in a not so subtle way, been shifted. Take a few minutes to look at Brightscope and share your thoughts and/or recommendations.

Learn more about your corporate retirement plan originally appeared on About.com Retirement Planning on Monday, October 19th, 2009 at 08:11:58.

Permalink | Comment | Email this