Showing posts with label Retirement. Show all posts
Showing posts with label Retirement. Show all posts

Thursday, January 28, 2021

Downsizing to Keep Your Adult Kids Out


At present, having your 21- to 35-year-olds living back at home is becoming normal. As of July 2020, 52 percent of 18- to 29-year-olds were living with their parents based on a September 2020 analysis of data from Pew Research Center.

The majority of parents have good intentions and openly take their adult children back home represents helping them handle a temporary situation to save money, reduce their debt or get a stable well paying job.

But if the returning adult child continues to remain beyond the time limit, the new situation can be much more than just a small inconvenience, health specialists claim. 

Young adults who neglect to establish progress at their job, brush aside multiple opportunities they are presented with can negatively affect Mom and Dad's finances, postponing any arrangements to scale down and decrease retirement savings.

This puts further burdens on parents from the ages of 50s and up. So, you should understand the odds are very high that you're going to have less money when your adult child returns home.

If you're expecting your 20- to 30-something child to return home or you've had enough of them repeatedly returning every few months and want them to become more self-sufficient, here's what you should do.

  • Establish expectations early.
  • Make it somewhat uncomfortable by not having a spare bedroom.
  • Don't allow it to repeat.

Consider downsizing your home


Downsizing is the term for moving from a larger home into a smaller-sized home typically with less maintenance. For some people, this means a home with less land (grass, bushes, trees) to maintain or a home with less square footage and fewer unused rooms.




Downsizing occurs frequently for parents whose children are grown and left home. There is no longer a need for one or two spare bedrooms, being near to schools, or having a large yard. This group of homeowners commonly switches to a home that best suits their new lifestyle and for the rest of their lives.

The process is quite simple, you'll sell your home and move into a smaller home that costs less than your existing home. The proceeds from the sale of your current home can be used for living expenses, or a portion can be put into a money market account and instantly available for any investment opportunities that may arise.

This strategy may give you some flexibility if you buy the new home with all cash. You can also simply refinance your home, get a line of credit or apply for a reverse mortgage to help you. Each of these options sounds like a win-win.

The best thing to do is to figure out how much will be put down on the next home you're buying or the maximum amount you'll pay for rent, and how this will affect your monthly cost. Consult with an expert such as a financial advisor or estate planning specialist.


Friday, December 25, 2020

Planning for Retirement in the US as an Expat




For those foreigners who have lived and worked in the US for a while, retirement in America can be a great option. Planning for retirement as an expat takes forethought and careful financial planning. For many the process takes years. Fortunately, there are many ways for foreign nationals to have a comfortable retirement in the US.

401(k)


This falls under the ‘Defined Contribution’ type of retirement plan. Expats who have not yet secured a permanent residence can also invest in 401(k). This avenue lets investors set aside a part of their pre-tax income for retirement. 

It has the added advantage of reducing the taxable income. At the time of signing up, investors have options such as mutual funds, bonds, and stocks.

Sometimes employers match their employees' 401(k) contributions up to a certain percentage. For example, a foreign national working in the US for a local employer earns $50,000 annually and contributes $2,500 (5%) per year into his 401(k). 

If the employer contributes another 3%, the employee gets an additional $1,500 added into the plan per year.

Another option is the Roth 401(k) plan. It differs from the 401(k) in that it is funded with after-tax dollars. Roth 401(k) is gaining popularity because it comes with tax-free withdrawals.

IRA


Individual Retirement Accounts (IRAs) work much the same way as 401(k) plans, except for two key differences. First, 401(k) accounts are maintained by employers whereas IRAs are opened by individuals. 



People usually go to asset management entities or brokerage firms to start an IRA. Second, 401(k) plans restrict investments to a single option – stocks, bonds, or mutual funds. 

An IRA allows for a more diversified investment mix under one account. It can also include real estate investments. Note that IRAs are taxable at the time of withdrawal.

Pension


A large number of expats in the US send money online to invest in various retirement plans in their home countries. For those planning to retire in America, investing locally can make more sense. 

Pensions are among the simplest retirement schemes for expats who are formally employed by US firms. These require no major investments on part of the employees. 

Employers who maintain pension funds give fixed monthly benefits to their employees after retirement. The pension payment is determined by the annual salary during employment and the tenure of service. Pensions offer much better benefits to those who have been in long term employment.

Pension is generally calculated at 1.5% of the average annual salary times the number of years of service. For example, someone who earned an average annual salary of $60,000 over 25 years of service will receive a monthly pension benefit of roughly $1,875 after retirement. 

This figure may appear underwhelming. However, for most expats this is not the sole source of income. They look upon pension as merely an additional income. It is commonly combined with social security benefits and other forms of income.

Social Security


Expats who are in the US for the long haul are entitled to receive Social Security benefits. The amount of benefit is determined by credits an individual has accrued over the period of their working years. 

These credits can be re-calculated after each month. The Social Security Administration offers a Retirement Calculator on its website. Individuals can readily determine the age at which their desired benefit amount will become available.




However, first, you must contribute to the Social Security fund. Both employers and employees must pay 6.2% of the annual wages, up to a maximum of $137,700. Self-employed persons are required to contribute to the entire 12.4%. 

Further, individuals must accrue 40 credits to be eligible for social security benefits. 1 credit equals 1 quarter of a working year. One must work for 10 years to be eligible to receive these benefits.

The retirement age in the US is divided into slabs. This is also applicable to foreign workers. For persons born between 1943 and 1954 the full retirement age is 66. For persons born between 1955 and 1960 the full retirement age gradually increases by 1 year till it reaches 67. 

Individuals can opt for an early retirement age of 62. However, this will bring a reduction of up to 28% in the monthly benefit payouts.

Fixed income annuities


This is a type of insurance contract that may be used toward retirement benefits. Individuals can buy fixed income annuities from insurance firms and contribute to their post-retirement incomes with monthly payments. 

For instance, a person who wishes to retire at 65 starts investing $500 monthly at age 30. This person will receive an annuity payout of about $540,000. This sum can be withdrawn in monthly, quarterly, or annual payouts as a fixed income. 

Furthermore, contributions to fixed income annuities are not capped like IRAs or 401(k). One can invest in annuities without limit. For comfortable retirement experts suggest investing at least 5% of your annual salary into fixed income annuities.

About the author:


Hemant G is a contributing writer at Sparkwebs LLC, a Digital and Content Marketing Agency. When he’s not writing, he loves to travel, scuba dive, and watch documentaries.



Monday, December 21, 2020

Financial Steps to Take When You Are Ready to Retire




Retirement is an exciting proposition for many people, but it requires meticulous planning and considerable financial responsibility. In order to set yourself up for retirement, you need a sound financial strategy. Here are the financial steps to take when you’re thinking about retiring in the near future.

Commit to a Budget


Budgeting has long been the central component of financial planning. In order to save up for retirement, you’ll need to spend the coming years earning significantly more than you’re spending. While you’re likely used to maintaining at least a loose budget, your pre-retirement years call for a renewed commitment to rigid spending limits.

Check How Much You’ll Have to Pay in Taxes


When considering how much money you have invested for retirement, don’t forget to account for the taxes that you’ll have to pay down the road. Some accounts will allow you to withdraw money without paying taxes. 



Others, like a traditional IRA, will see your withdrawals taxed as regular income. If you fail to acknowledge these future taxes, you could make some dangerous miscalculations regarding your retirement finances.

Calculate Your Post-Retirement Spending


In order to determine if you’re ready for retirement, you need to calculate how much money you’re likely to spend in your twilight years. If you’re committed to a costly mortgage or severely in debt, then you’ll have to take this into account. Only when you know exactly what your expenses will be can you make a confident plan for retirement.

Pay Off Your Debts


Eliminating any outstanding debts is a great way to set yourself up for a steady retirement. Interest rates can seriously cut into your retirement savings. By paying everything off before you stop working, you give yourself a clean slate. This will give you a wonderful sense of freedom as you embark on your retirement.

Save Up for Unexpected Expenses


Don’t forget to account for unforeseen expenses that could crop up after retirement. You never know when an accident or unexpected incident could force you to dig deeper into your savings. Even if you’re on Medicare, there are some medical care options that your insurance won’t cover. To play it safe, it’s best to have a sizable rainy day fund set aside.

Planning for retirement is all about safeguarding your financial health. If you take the steps mentioned above, you should be able to ease into a carefree retirement.



Thursday, December 17, 2020

Plan Ahead: Strategies to Help Ensure That You're Ready for Retirement When It Comes




Retirement is a time to quit working and start to enjoy life at a leisurely pace. If you want to have enough money for retirement, it's important that you prepare as soon as possible. Here are some strategies that you should utilize to help ensure that you're ready for retirement.

Cost-of-Living Projections


You really won't know how much you'll need for retirement until you do some sort of cost-of-living projections. You need to think about what your expenses maybe during that time. 

You will need to factor in things like whether or not you'll have a mortgage and if you plan on traveling. This analysis will give you a more accurate picture as to how much money you will need to save in total before you retire.


Budget Money From Every Paycheck


You will most likely need a substantial amount of money before you can retire. Because of this, you should set aside money from every single paycheck to put towards retirement



This will keep you from having to come up with a large sum of money all at once later in life. Even setting aside a small amount of money can really have a huge impact if you are consistent.

Pay Off Debt


It's also a good idea to put aside as much money as you can to pay off debt. It will be difficult to live off a smaller income in retirement if you have debt that you are still paying for. You should strive to have the smallest amount of bills possible once you retire.

Smart Investing


If you won't be retiring for a while, it's a great time to start investing. You might want to consider putting some money in the stock market or buying some investment property. While it is always a risk to invest, you can grow your money and come out financially ahead when it comes time to retire.

Financial Planning


You can get help with all these things by looking into financial planning. A financial planner will meet with you to discuss your needs and concerns about your future. 

After taking a look at your current financial situation and your goals, they will help you determine the best steps for you to take in order to accumulate the amount of money that you'll need in order to retire comfortably.

Planning for retirement can be overwhelming when you consider the amount of money you might need. Fortunately, there are some strategies that you can start to utilize in order to ensure that you're ready for retirement when the time comes.




Wednesday, October 7, 2020

Handling Finances: How to Plan For Your Estate




You don't need to own a lot of property or have a great deal of money to need an estate plan. In fact, if your possessions are limited but those you want to give to are in serious need, you'll want a plan that will disperse your assets quickly. Making a list of what you want to accomplish, what you have, and how you want things parsed out is critical.

What's Your End Goal?


Do you have a charity or family member that holds your heart? Then you have a reason to create an estate plan. Carefully consider the people to whom you want to leave your hard-earned possessions and ready cash. 

While making this list, pay special attention to your remaining dependents, including pets. You want to know that if something happens to you, others are covered.

Define Your Assets


To start, make a list of all your bank accounts. What funds do they have, and where will this money go? Then, make a list of your possessions of value. This can be a home, a car, art, or jewelry.

If you own any of these things jointly, sit down with your spouse or partner, and define how you want these possessions to track. If you're married, generally your surviving spouse and offspring will immediately receive the assets. 

If you're divorced, there will likely be legal limitations to be overcome before your asset dispersion can be securely defined.

Stay aware of the laws in your state. Consider a conversation with a Los Angeles estate law firm to protect your California home and assets, for example, from probate or other asset-draining stages in dispersal.

Proper Valuation


Bank balances, retirement accounts, and other monies, stocks, and bonds are fairly straightforward as far as determining their value. However, real estate values change over time. 

Additionally, if you own art that you purchased early in the career of an artist, it may be worth much more as that artist builds a following.




Proper valuation of your assets is particularly important if you're splitting your estate between heirs upon your death. Hire a professional to give you a valuation on anything that may be of fluid value in the future, and get it reappraised in the event of a sizable market change.

Covering Your Assets


If you know that you're leaving behind someone who will need what you intend to give them, it's critical that you invest in the insurance you need to avoid end of life costs. 

A basic long-term care policy, taken out while you're hearty and healthy, can be of manageable cost as you age and make it possible to pass on your legacy.

Additionally, it's important to remember that it's not only age that can lead to needing long-term care. If you have children, it's crucial that you have a plan in place in case you are incapacitated by illness or injury.

Speeding Up the Process


Create vehicles in which to place your assets for long term needs. If the person you want to give to has special needs, consider setting up a special needs trust. Work with an attorney so you can be sure that your assets go in the right vehicle.



For example, if you have a dependent child who will always need support, the right trust will allow them to receive disability insurance as well as your contribution. 

The wrong trust will block them from receiving any disability until the trust has been completely wound down. Each state is different, so do this right the first time to protect your loved one.

Avoiding Probate


If you only have a will, chances are extremely good that your goods and monies will have to go through probate. Depending on the state you live in, avoiding probate will take multiple steps unless you have a surviving spouse. If you are divorced or your spouse has passed on, probate is likely the next step.

Probate is time-consuming, frustrating, and sometimes costly. Don't rely on your will to protect your loved ones from this process, especially if they need those assets to thrive. Address this while you have the ability to make good decisions.

Nobody likes to think about estate planning, but it's an important part of your legacy that needs to be addressed. Do the right thing now to protect the people and causes you want to support in the future.





Monday, September 28, 2020

Looking for Scenery? Why Retiring on a Lake Could Be Right for You




Planning for the final step of the American dream is something that everyone should do. You don't want to reach the age of retirement and be at a loss for what you want to do and where you want to go. If you're trying to decide on the right location to spend your retirement years, here are some good reasons that a lake may be the ideal spot for you.

The Blue Effect


Most people come to notice that being by water tends to allow them to relax psychologically. This is known as the blue effect where being in, on, or underwater allows both the brain and body to enter a zen state. 

This effect has been proven to lower blood pressure and reduce anxiety in patients. It also helps to increase the quality of your internal thoughts, which can boost the health of your immune system.

Enjoy New Hobbies


A lake provides the perfect outdoor environment where you can try out some new hobbies. Some of the most popular include fishing, swimming, birdwatching, photography, and hiking. All of those activities that you had trouble finding time for while working are now at your disposal to discover. 



When you enlist the help of someone like those at The Stockton Team: Keller Williams Showcase and other places, you can find the right lake house that has all the hobby opportunities that you could possibly want.

Family Getaway


If you're reaching the age of retirement, it's likely that you have some grandchildren or some on the way. Having a fun spot for your grandkids to enjoy while you get to watch them grow up is a necessity. 

They'll have endless activities to enjoy like kayaking, fishing, hiking, swimming, and boating. A lake also provides the perfect backdrop for family events like picnics and birthday parties.

A Private Community Feel


During your years of retirement, you want to enjoy your own schedule. Privacy at your lake home can provide a relaxing environment for you to spend your later years. 

Plus, many lakes create a community feel. You'll get to know the neighbors that surround the lake and feel as if you're a part of a bigger community.

Retiring at a lake house is the ideal choice for many. It offers so many benefits from a more relaxing lifestyle to a sense of community. If you're considering a move to the lake, we highly recommend that you do so as you'll receive all the benefits above.




Monday, August 31, 2020

Financial Organization Skills You Should Know After Retirement



When it comes to your financial well-being, there is a lot that goes into it. Over the years, you'll be sure to develop more and more knowledge on how to properly take care of yourself in a financial sense. When it comes to the organization of your financial well-being, here are some of the things you should know after you retire.

Budgeting


The basis of all your financial organization skills should be budgeting. This is recording how much income you have coming in each month and what you'll be spending it on. Your budget should include things like rent or mortgage, insurance, groceries, and so forth. 


When you have budgeting skills, you can ensure that you make your payments on time and you don't go into unnecessary debt.

Bill Payment Calendar


Apart from building a good credit score and being able to sleep at night, making your payments on time can help you to avoid costly overdraft fees. Some credit card companies may even increase your interest rate if you don't pay your bill on time. Having a calendar system to ensure that you pay your bills on time is a necessity. 


Some retirees may find it easier to set up automatic payments for things like their mortgage and car insurance so they don't have to worry about paying for them manually each month.

Determining Asset Delegation


As you get older, you're more pushed into thinking about what will happen to all of your assets in the event that you die. Apart from getting insurance to help cover the costs associated with your funeral expenses, it's vital that you get your estate planning figured out. 




While most states will allow you to create wills yourself, it's highly advisable to seek out professional legal help. This way, you can ensure that your estate is delegated the way you intended it to be.

Financial Literacy


There are many financial terms out there that we have all heard of. But, how many of them do you actually understand and can utilize in your financial planning strategy for the future? 


It's a good idea to take some time to learn in-depth about things like annual percentage rates, CDs, mutual funds, trust funds, and so forth. This way, you can properly plan out your financial future using mediums that make sense to you.

Just because you're retiring from your day job doesn't mean that you have to stop learning. In fact, the years after retirement give you a great opportunity to capitalize on the wealth you've created. To get started, you should hone in your skills on the topics of the financial organization listed out above.





Wednesday, August 26, 2020

Figuring Out Your Finances Before You Choose a House to Retire In



When it's time to retire, you need to consider where you want to spend your retirement. You need a final home where you are comfortable and safe. Of course, you also need to be able to afford the home. Here are some tips on figuring out your finances before you choose a house to retire in.

Living Within Your Means


Ultimately, you want to pick a home that you can afford easily. You don't want to stretch out your finances in your golden years. You want to have money to spend on vacations, dinners, and spoiling the grandchildren. For that reason, you need to pick a place that is in your budget.

Take the time to look at your retirement plans and income. It may be helpful to sit down with a financial advisor so that you set up a solid budget. They will be able to help you understand what money you have, what income you can get, and where you might be able to grow your money a little more. With all this information, you’ll be better able to set a

 manageable budget. Then you can figure out what you can afford to pay for your home.

Consider Additional Expenses


As you probably know by now, a home comes with a lot more expenses than just the sale price. You need to consider all of the additional costs you will have with your new home including HOA fees, home repairs, landscaping, taxes, and cost of living. These costs can add up quickly, so you need to include them in your budget every month. Make sure you have money for repairs, and good insurance, too.




When you start the purchasing and closing processes, you might consider consulting a real estate law firm. They can help you make a contract that protects you from paying too much or making too many concessions on a house that may need work to be up to your standards. They can also help you with other issues that might come up during the buying process.

Think About Medical Expenses


As we get older, we are more likely to run into serious medical issues. These medical problems are draining on the body, but they are draining on the bank account, too. You need to save plenty for any medical expenses that might come your way, including in-home care when you get to your final years. These things do not come cheap, so be prepared.

Your final home is an important decision. While you want to be comfortable in your golden years, you also want to have money to spend and give to the people you love. Before you pick a home, consider these aspects of your finances to help you make the right decision.




Tuesday, July 28, 2020

Reverse Mortgages and Retirement: How Your Home Can Help You As You Age


For many people, retirement is something they look forward to. For others, they fear it due to a lack of financial planning. However, even if you don't have a fat pension or a great investment plan, you can still retire comfortably during your later years if you are a homeowner. 

This can be done via a reverse mortgage that transforms the equity you have built up in your home into retirement income. Below are some of the benefits of using a reverse mortgage for retirement.

It Can Give You Cash


One of the biggest problems for retired seniors is not having enough monthly income. A reverse mortgage can help with this problem in two ways. If you are still making mortgage payments, it can eliminate that monthly expense after you refinance. 


 Then, any equity left can be used to produce a steady stream of retirement income. This can be a great help if you need more than Social Security and whatever retirement plans you have to make ends meet.

It Allows You to Stay in Your Home


One reason why some people are fearful of reverse mortgages is that they believe that they will be forced out of their homes. This is not true at all. The homeowner actually retains ownership of the home until they and their spouse pass away. 


Only then will it be transferred to the lender. The reverse mortgage can also end if you choose to move at some point. Still, it is an excellent option for those that want to continue living in their home permanently.

Your Heirs Won't Have to Pay for It


Another fear people have is that their children or other heirs will have to pay the bill if the amount of equity used exceeds the actual value of the house. This is also false. A reverse mortgage is a kind of financing known as non-recourse. 




What this means is the lender will have no ability to make a claim against an heir to pay for that debt. The responsibility for paying that debt isn't allowed to exceed the value of the home.

The Income Isn't Taxable


Another huge benefit you should be aware of is the fact that the income you receive from your reverse mortgage isn't taxable. This is due to the fact that the IRS categorizes the payments you receive as "loan proceeds." This is a significant advantage over other kinds of retirement income that can indeed be taxed by the federal government.

There are many benefits to having a reverse mortgage during retirement. However, taking out one may not be best for everyone. Consider the benefits, your plans, and your financial situation when making your decision. Get some advice on the matter. It may turn out that a reverse mortgage is right for you and your family.




Tuesday, July 14, 2020

4 Factors in Deciding to Refinance Your Home Before Retirement



As retirement is looming, an idea to refinance your home might be lingering on your mind. You can make the right move using some strategies that will ensure that you remain financially stable. 

Please have a look at the factors that will help you decide whether the idea is viable or not.

Current Interest Rate


If you can lower the current interest rate by 1% or more, mortgage refinancing will be successful. It will make sense since you can pay the loan within a short time. In addition to that, you can build your home’s equity seamlessly with the payment rates. 


If the remaining balance is quite high and you can get a 2-3% reduction on interest, you can go ahead and refinance your home.

Total Refinancing Costs


The cost of refinancing will also play a pivotal role as you make a life-changing decision. Usually, you will cater for closing costs just like you did when you took the initial mortgage. On that account, you have to calculate the expenses to see whether they will favor you or not. 




For example, if you save about $100 per month and the closing costs are $5,000, it will take you roughly 50 months to break even. The need to refinance the loan doesn’t make sense at this point if you intend to move out of your house.

Eligibility


To qualify for the loan, you need to have a stable income and a positive credit score. Therefore, you should look at your financial status to ascertain whether you will get the loan or not. The new underwriting process will dig deep into our cash flow and credit status. It will also look at your home equity concerning the amount that you have.


How Long you will Stay in your home


If you don’t intend to sell the house or move out, there is no need to refinance. It will take many years to clear the debt so that you can start saving again. On that account, you should only take action if you will continue living in your current home. With low-interest rates, you can repay the debt faster and start enjoying the golden years.

Subsequently, refinancing your home is an excellent idea if you can get a lower rate to pay off the loan. Your income, credit score, and home equity play a crucial role as well. Plus, you can benefit from the strategy if you don’t have intentions to sell it.





Thursday, July 2, 2020

4 Tips for Deciding Where to Move After Retirement


Retirement is an occasion to be celebrated after a life of hard work, planning, and saving. With so many options worldwide, the idea of searching for the best place can be overwhelming. 

While most people stay in their current homes, others decide to relocate. Deciding where to live after retirement should involve a thoughtful process instead of just picking a favorite childhood vacation spot. Below are four things to consider when choosing a retirement home

Cost of living


Choose a city with an affordable cost of living; when you choose a retirement home, your cost of living will play a significant role in your day to day life. Find a city with an affordable cost of living that suits your lifestyle and budget. You should also ensure that housing cost is within your financial means. Do not just consider luxury homes without checking your budget.


Safety and Security


Always consider the safety and security of the area; as you grow older, safety should be your number one priority. Take a look at the economic data and crime statistics of the cities you are considering moving to and choose somewhere you can feel safe. 


Crime varies from place to place, and some towns may not have available crime statistical data online. It would be best if you considered turning to the local police or the local people for answers. This will give you specific information making your decision ultimately more straightforward.

The healthcare services and amenities


Choose a city with available healthcare services; before moving to a new town, always consider the availability and quality of the healthcare system. Ensure that there are hospitals and available medical emergency services nearby in case you are in dire need. 



Talk to the local people and do some research, inquire about hospital wait time, emergency response time, and local pharmacies. It would be best if you chose a city that will make you feel taken care of.

Weather and climate


Consider the climate of the area; weather should be factored in when selecting a retirement hometown. You will spend your retirement years in the weather of your choice. Whether you want to move to a warm climate area in a small beach town or a cold winter town in the south, it is yours. 

Most times, retirees move to a warm-climate area to avoid the risks that cold weather pauses on their health. The real hustle of scooping snow from surfaces or the threat of slipping and falling on ice is less manageable for aging people.

When considering your final retirement home, you should ensure to explore all your options and find all the factors named above. Discuss with your friends, family, and independent advisors about this next chapter of your life. This will help with emotional preparation if you decide to move out of your current city. Acquaint yourself with the new area you are considering moving to.



Monday, May 18, 2020

How to Take Care of Your Finances After Retirement



Your ability to manage your money after you retire may actually be just as important as your ability to save. To make sure that your income is well-protected, it’s critically important to know your risk tolerance. You must be comfortable with your investments as they currently stand. You will also want to plan properly for those you will leave behind.

Cash Today: Needs Vs Wants


Careful monitoring of your spending and tracking where your dollars are going out is always a good investment of your time. Knowing where you need to spend your money and doing so with care will give you more cash for your “wants” when they crop up. 

If one of your retirement goals was the chance to travel, then you will probably need a reliable vehicle. With a focus on the right car, you can pare back other expenses more easily.

Investments: Maintaining Liquidity


If you have money in stocks and bonds, converting those assets to cash will be a simple process. However, if the majority of your money is tied up in your house, art, or rare coins, converting these things to cash may be more of a challenge. 



Selling your home and moving to raise cash quickly means that you may not get the best price. Such a move will also be extremely stressful and may impact your health.

Tax Planning


The laws on Required Minimum Distributions (RMDs) have changed repeatedly over the years. If you are approaching 70, contact your accountant for instructions on the best way to manage the minimum distributions you must take from your retirement accounts to avoid a punitive penalty.


After You’re Gone


Make sure you have a life insurance policy that will at least cover your funeral expenses. In addition, consider setting up an agreement with a funeral home and mortician so that the expense of managing your final remains is taken care of. 

The professionals at Damar Kaminski Funeral Home & Crematorium can help you select the best plan for your budget. Once you’ve made your selection, be sure to let your family know of your choice and get a copy of the agreement to your executor.

Conclusion


The first few months after your retirement may be worrisome. Making sure that you can thrive on the retirement dollars you have coming in may take some budgetary adjustments. However, if you can keep your goals in sight and focus on putting your time and dollars there, you can enjoy a retirement focused on what you’ve always wanted to do.



Sunday, April 19, 2020

4 Fun Luxuries You Should Budget for in Your Retirement



Just because you're retired doesn't mean your life has to be boring. In fact, with no job to report to, your retirement can be one of the most fun stages of your life.

Of course, to take part in these fun activities, it's important to budget for them while you're still saving for retirement. To help give you an idea of how much you'll need to save, here are four fun luxuries you should budget for in your retirement.


Travel


If you've always wanted to see the world but never had the time to do so, retirement is your perfect opportunity. Whether you choose to travel the country in an RV, fly off to faraway places, or take things slow on cruises, travel should definitely be something you budget for. By prioritizing which destinations you'd like to visit most, you can be more accurate in your budgeting for these indulgences.


Experiences


Even if you don't feel like traveling far from home, you can still budget for experiences that are right in your own backyard. Whether it's season tickets to the local orchestra, some front row seats to a show by your favorite band, or a membership at your local zoo, experiences can add so much richness to your life. If you can include others in on your experiences, you'll likely find that your enjoyment increases that much more.


Sports


While you probably shouldn't use your retirement years to take up tackle football, retirement can be a great time to try your hand at calmer sports, such as golf. You may find a hidden talent for a sport that you never got to try during your working years. 



You could even find yourself becoming so passionate about a sport that you spend some money to buy country club properties for sale so that you can always be ready to play.

Hobbies


During your working years, your hobbies are what you do with your leftover time and money after the essentials are taken care of. With the right budgeting, though, your hobbies can take a much more central role in your retirement. 

You can use extra disposable income to upgrade to better equipment that's required for your hobby and use your extra time to perfect certain skills within the hobby.

With so many activities to do during your retirement, you may encounter a "fear of missing out." In other words, you may see retired friends doing things that you wish you could do, putting stress on you to find the money and the time to do the same things they do. However, as long as you're enjoying what's right in front of you, you can relax and know that you're making the most of your retirement.



Wednesday, December 11, 2019

There's No Wrong Time To Be Thinking About Your Pension


There might not be a wrong time, but there is a right time, and that time is now. Whether you're in your twenties, thirties, forties, or fifties, if you've not started thinking about your pension, there’s no time like the present. Obviously, the earlier you start preparing the better.

If you think your retirement is a lifetime away, you’ll be surprised how quickly it comes around. Before you know it, you’ll be knocking on the door of retirement and have made no financial preparations. Do you want to spend your twilight years worrying about every penny you spend? Surely that’s not why you’ve been working all these years.


Getting the Best Pension Deal


There are plenty of different pension options, but you need to be sure you've got the right one. You might have caught one of the many media stories about pension misselling. 

If you don’t want to get caught out with a mis-sold pension, you must do your research. Here are some of the contract-based pension schemes you might want to sign up for.

SIPPSelf Invested Personal Pensions are a type of pension that can run alongside a workplace pension. These pensions are an individual contract between yourself and a pension provider. The broad investment powers of a SIPP mean you can invest in a range of assets.

SSAS – SSAS stands for the small self-administered scheme. It is a type of defined contribution pension an employer can self-manage. There do, however, have to be fewer than 12 members.

QROP – A Qualified Recognised Overseas Pension Scheme is an overseas pension scheme that meets specific HMRC requirements. A QROP has to have a beneficial owner and trustees. It can receive transfers of UK pension benefits.

These are just three examples of the type of pension scheme you might be able to sign up for. For a person without any pension scheme knowledge, navigating the pension waters can be very dangerous. But who can you ask for advice?


Where to Get Your Pension Advice

Trying to find the best pension advice can be challenging, especially if you have no previous experience. Whether you want SIPP, SSAS, QROP, or any other type of pension, having someone you can trust in your corner is vital. 

To lower the risk of mis-sold pensions or a mis-sold annuity, you should seek the advice of an FCA authorized financial adviser. Don’t be tempted to get help from a pension introducer, as these people are not the best place to go to for pension advice. 

There have been numerous cases of a pension introducer playing a part in one of the many mis-sold pension and mis-sold annuity scandals of recent years. A pension introducer often cold-calls potential clients. 

They then pass on your details to an unregulated marketing firm. They are not regulated by the FCA and therefore could be a party to a pension mis-selling scam.

If you find you’re the victim of a mis-sold pension, it is possible to get claims advice, but the route to getting your money back is fraught with obstacles. To be successful with mis-sold annuity claims or SIPP claims, you have to be able to prove you were given the wrong advice. It might relate to a final salary pension transfer, defined benefit pension or one of many other pension alternatives.

There have been many cases of mis-sold pensions and annuity claims in the recent past. So much so that a whole industry has grown up around mis-sold pensions. SIPP claims, annuity claims, problems with a defined benefit pension, or a final salary pension transfer can often be solved. 


Provided you know where to get claims advice. The best place to start is by calling the Pensions Advisory Service. 


Thursday, December 5, 2019

4 Expenses You'll Need to Think About as You Approach Retirement



While the prospect of bidding farewell to employment entices most, many seniors fail to account for the added expenses that come with retirement. Though you’ll likely have some income coming your way, it’ll be considerably less than what you’ve grown accustomed to receiving. As you grow older, here are four expenses that you’ll want to be mindful of.

Healthcare


Old age generally gives rise to medical issues. With that said, you’ll need to account for frequent doctor visits and potential medications. On average, retirees rack up $500 a month in medical expenses. 


From deductibles and copays to premiums and coinsurance costs, there are various fees that come into play. To ensure that your savings account doesn’t take a hit, set aside ample funds to cover healthcare costs.

Funeral Needs


While this is a grim reality, death will inevitably rear its ugly head. When the time comes to commemorate your loss, you don’t want your loved ones to have to carry the financial burden. 




With that in mind, place enough money to the side so that your family members can tend to your funeral needs without dipping into their own wallets. Moreover, you’ll want to guarantee that you’re working with an affordable funeral home service like Damar Kaminski Funeral Home & Crematorium.

Leisure


With so much free time on your hands, you’ll have nothing but opportunities to relax. Sitting inside all day can be a drag, so you’ll want to fill your time with activities that spark joy. Unless you can score some free leisure, these outings will generally cost money. 


If your budget doesn’t allow for frequent trips to the museum or movie theater, consider volunteering. Not only is this a free alternative, but it’ll also provide a chance to give back to the community.

In-Home Care


If you can no longer care for yourself, enlist the help of elderly care professionals. With their helping hands, you’ll be able to carry out daily activities with ease. Bear in mind that these services are rather costly. If this is the avenue you pursue, don’t be alarmed by the high rates. By accounting for this expense in advance, you’ll have enough funds at your disposal to cover the costs.

If retirement is right around the corner, there are numerous ways you can plan for your new lifestyle. Above are some common expenses that you’ll want to take into consideration.




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