Thursday, September 13, 2012

50+ Concerns About Retirement Savings

English: ceramic piggy bank
 (Photo credit: Wikipedia)

Folks entering their 50s have a lot to worry about or be concerned, what with kids starting to go to college, planning for retirement, creeping health issues due to age, work, and where things will be in the near future. That said, one of the most complicated concerns tends to be how to save enough for retirement. Most want their retirement to be at least the same as when they worked, just without the job. But how that works is lost in the details for many.

Fortunately, instead of aiming for an imaginary dollar figure that seems impossible to achieve, people in their 50s need to instead focus on maximizing their savings by doing the following:
  • Make the maximum annual deposit to a Roth IRA if eligible. For an individual this is $6,000 after age 50. If a spouse doesn't work, a spousal Roth IRA can take another $6,000 as well. The money grows tax free in the meantime with no deadline when it needs to be withdrawn. 
  • If pre-tax money is regularly received through a business, put it into a traditional IRA up to $6,000 a year after age 50. The same spousal benefit works in this scenario as well. 
  • Where a 401k is available at work, up to $50,000 can be deposited annually. If the employer provides a match, that’s an extra pot of cash added into the 401k for free. Many who do provide a match do so dollar for dollar. 
  • With the legal tax shelters taken care of, savers then need to make sure they continue to add to conservative savings and market investments with a mix of at least 60% immediate savings and 40% market investment or bonds. This approach maintains value while still taking advantage of market upswings when they occur, without risking the entire balance. 
  • Extra-dedicated types might want to consider taking on a second part-time job if they have the time. This allows additional earning power while young enough to handle the burden without any liabilities against the extra revenue stream. That means large amounts of incoming money each month that can be sent direct to savings and investments. 
  • Consider working a bit longer to maximize both savings as well as social security benefits. By working to 67 rather than 62, the difference income and savings can as much as $50,000 or more.

Fifteen years of doing the above while working other asset angles such real estate and inheritance will definitely build a large retirement base for the dedicated saver. While it may not produce a guaranteed $5 million, the saver will have a significant amount of funds to rely on in retirement when needed. This approach will not only alleviate concerns about saving enough, it tends to get a saver thinking about other ways to live more efficiently. That in turn causes other ripple benefits along the way.


Author Bio:
Roxanne Porter is a freelancer & a regular contributor for www.nannyjobs.org/.  She helps in providing knowledge about nanny services & love writing on nanny related articles. She helps in giving a fair knowledge about nanny Jobs to the community. You can be in touch with her at “r.poter08ATgmail.com”.



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