Retirement Investing Advice

Retirement Investing Advice


By Ric Dalberri, Founder of Retirement USA

Baby boomers look for retirement investing advice as they
should. Since this generation is living longer and healthier than their parents
and grandparents, they need to have enough to support them or return to the
work force. In today’s economy, many companies are not providing company
pensions or a 401K.

Unless you inherit a large sum of money or win the lottery,
you will need retirement investing advice for sure. Social Security will not be
enough to live the way you want. We are hearing that Social Security that we
are relying on may not be there by the year 2047. In additions, how many jobs
will be available for you at your age?

Retirement investing advice is serious. There are only a few
ways to save for retirement in qualified (being tax deferred) plans. They are:

1) Company sponsored 401K plan. This is considered ‘FREE’
money. The money comes out of your paycheck pre-tax. So contributing 6% doesn’t
make too much of difference in your take home pay. What you contribute is tax
deductible and taxes are deferred. So, you don’t pay taxes until you withdraw
funds. Usually, your tax rate us much lower when you reach here. Also, your
company is also contributing to your 401K up to a certain percentage. That’s
why it’s ‘FREE’ money to you. When you are seeking retirement investing advice,
jump on this 401K if you are fortunate to work for a company that offers it.
Retirement investing advice can be offered by the company or the third party
firm who administers the 401K plan. You have many options. Risk ( younger age
), conservative or as we mature in age, guaranteed funds.

2) Traditional Individual Retirement Plan (IRA). This plan
is also funded with pre-tax or tax deductible dollars. There are maximum
amounts that can be contributed each year. Starting in 2005, it is $4,000. If
you are over 50, you can use what is called ‘catch up’ amounts to contribute
each year. If you are also a part of a 401K, you will be restricted as to how
much you can contribute to a traditional IRA. If you file your taxes separately
from your spouse, you can avoid restrictions by having the IRA in your spouses’

3) Roth IRA is another retirement investing advice tool.
This however, is funded with post (after) tax dollars. You will not get a tax
deduction the year you make your contribution. The good thing is that Roth
IRA’s are not taxed ever again, including earnings on the investment. For this
to happen, you must have the Roth IRA for a minimum of five years and be over
59 ½ years of age. There are allowances to use the funds without penalty before
retirement, such as major medical expenses, down payment on your FIRST home or

Retirement investment advice may include changing your
lifestyle before your retire. Why? To get acquainted with the lifestyle you may
have to embrace. Retirement investment advice indicates that you may have to
downsize and change old habits.

* Hold off on home improvements or do them yourself.

* Stop eating meals out. Start planning menus.

* Trim your wardrobe. Get used to wearing clothes longer.
Purchase a hand steamer instead of sending clothes to the dry cleaner. Sending
clothes to the dry cleaner ( in my experience) shortens the life of the

* Don’t buy books. Get a library card and visit the library.

* Only keep one credit card for emergencies only.

* Don’t purchase a new car. Seek pre-owned dealer warranted

* Keep thermostat lower

This is only a few area’s for your retirement investment
advice for your to consideration. Retirement investment advice takes a lot of
diligence on your part. Always seek professional retirement investment advice
from a qualified specialist, such as a tax attorney for estate planning.