If you are a small business owner, you may be seeing a slight uptick in your business – and your confidence. In fact, many small business owners are starting to think about hiring a few more people, and perhaps even offering a few employee benefits again … such as a retirement savings plan. Stuart Robertson of Forbes recently wrote a brief, concise overview of the top three retirement plans available for small businesses (those with 25 or fewer employees). Before you start researching options, Forbes suggests you ask yourself these five questions: Can I afford a match for my employees?…
According to recent research from The Center for Retirement Research at Boston College, 70% of baby-boomer households will receive inheritances worth a total of $8.4 Trillion. With an average of $300,000 for most inheriting households, and an average of $1.5 million for the wealthiest inheritors, the better part of a generation is expected to see a nice bump in their assets. The question, then, is what to do about it. Ashlea Ebeling of Forbes recently approached the topic with a number of considerations, from warnings to ideas. Consider Keeping it Separate. The first thing to take stock of is how…
If you’ve been a diligent saver and keeping an eye on your 401(k) for all these years, it’s important to remember that the tax-man also has been looking on with interest and waiting for his cut. It’s simply too easy to forget, but a traditional IRA is tax-deferred until withdrawal, so that balance is deceiving. What is more, it means that the tax you will owe has yet to be decided. A recent MarketWatch article points out the strong possibility of higher tax rates for 401(k) savers once they reach retirement. The value of delaying a tax hit into retirement,…
This MarketWatch article tackles the common subject of delaying Social Security, the benefits that arise from doing so, and the possible problems to avoid, but it does so in more depth. Also see a recent article from the WSJ digital Network on the same subject.
This MarketWatch (March 21, 2011) article discusses how one ought to think about employment as one enters retirement, and why it’s good to keep working. The article focuses on relatively high-earners for which employment ensures a protection against boredom and, more importantly, an income buffer to fill out your needs rather than an advancement in one’s career (it’s perfectly fine to step the income down.) The conclusion is that retirement has to be rethought and considered independence out of flexibility to do what I’d like, rather than independence from employment altogether. Also review this article about small business start-ups begun…
It’s no secret that “retirement” is a touchy subject nowadays. Costs are up, savings are down, and the public is generally pessimistic according to the 2011 Retirement Confidence Survey. As a recent SmartMoney article relates, one increasingly popular solution, although it might not be an easy one, is to escape domestic problems and costs by going global and retiring abroad. It’s hard to say just how many retirees are living offshore. They aren’t counted in the census, and many go to great pains to fly below the radar, but according to the Social Security Administration the number of retirees taking…
Purchase a whole life insurance, with a rider to the policy which pays for long-term care ( home care or care in an assisted living or nursing home). If you do not utilize the long term care benefit, your beneficiary will receive the policy’s face amount. Example. You apply for a $500,000 whole-life insurance policy, with a rider for long-term care that will pay you 2% of the face amount each month if you need long-term care services. Therefore, you will receive up to $10,000 monthly ($500,000 x 2%) to pay for home-care, assisted living, or nursing home services. Consequently, if…
In a continuation of their previous article about test-driving your retirement plans, SmartMoney recently offered a reminder about the prospect of a transitional retirement – which may be the best way for some to leave the workforce. Retirement doesn’t have to be a climactic stopping point, where yesterday you were working full speed ahead and today you’re at full stop. From a financial planning standpoint, it’s difficult to transition from a full working income to a retirement income – especially if your retirement accounts took a recessionary hit. From an emotional standpoint, the abrupt lifestyle adjustment may be difficult to…
Depending largely on age and income, between 4 percent and 14 percent of Americans who otherwise would have had adequate income to cover basic expenses in retirement became “at risk” of running short because of the housing and financial crisis of 2008–2009, according to a new report by Employee Benefit Research Institute (EBRI). The EBRI analysis, based on its retirement income adequacy models, notes that the likelihood of becoming “at risk” because of the economic crisis depends to a large extent on the size of the retirement account balances the household had in 401(k)-type plans and/or individual retirement accounts, as…
Americans hold nearly $4.2 trillion in traditional IRAs. That money has yet to be taxed, so it’s small wonder that the government requires you to take your money out and start paying taxes on it. Required Minimum Distributions generally apply once you turn 70-1/2 years old. The required distribution amount is determined by a formula based on your account balance and your age. Bloomberg reported last week, however, that the Obama administration proposes to do away with minimum distributions on IRAs worth $50,000 or less. If this measure passes, it could impact a lot of people. The median amount of…
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