It's never too late to plan.
Saving For Retirement
It’s how people save to buy a home, to send the kids to college and retire in comfort, during your working years, take a portion of your paycheck and send it via direct deposit into a separate, special account at your credit union. If you don’t see it, you don’t miss it. As this money accumulates, move it to more long-term investments consistent with your risk profile and time horizon. With all these goals, retirement especially, time is your friend. Properly invested, money grows.
Shifting investment styles
When you’re just starting to save and invest for your retirement, you may be like many people: comfortable accepting greater volatility and risk for the possibility of greater gain. As you approach retirement, you may have far less tolerance for ups and downs. Investors tend to shift to more conservative decisions, because losses just prior to retirement can be challenging -- and leave you little time to make it up with some unknown future gain. Prior to shifting your investment styles, it's important to understand your current asset mix.
When should you retire?
This can be a complicated decision, and it’s certainly a personal one. After a lifetime of work, are you financially and emotionally prepared for this new time of life? The fact is, you’re in control of the big decision, and you can be confident you’ll make the right one, especially if you’ve done your preparation and homework. Review your asset and liabilities to help you determine your net worth, which could help you with your decision.
Living in Retirement
Making your money last.
The key to a comfortable and successful retirement is not outliving the money you’ve saved by creating a budget. Be careful with credit cards and new debt. Claim that senior citizen discount wherever it’s offered. Read the fine print about taxes on all your investments. And use your credit union for all it’s worth; they usually offer the best rates around for your money.
Be strategic about Social Security.
Social Security is available to you at age 62, but it’s great if you can wait. Take it early, and you get 25% less than if you wait until full retirement age of 66 at which time you’re entitled to 100%. If you can wait until 70, you get 35% more. People often coordinate Social Security benefits with spouses who are also eligible. Maybe one of you takes benefits early, and the other waits. Visit ssa.gov for more information about social security.
Tapping your retirement plans.
You may have a defined benefit pension plan from a former employer. Your 401(k) and perhaps IRAs will also likely play a central role. It’s your choice when to withdraw funds from these accounts. If you want to begin tapping them or simply want to roll them over somewhere else, make sure you understand all your options and the ramifications of every decision, as well as the minimum distribution amounts. Distributions from IRAs and 401(k) plans are required as you reach age 70½.
Saving for College
College matters more than ever.
College costs continue to skyrocket, outpacing increases in income. Without careful planning, your children could find paying for higher education difficult. People with college degrees out earn their less educated peers significantly over a lifetime. They have an easier time getting work and withstand recessions and downsizing better.
How much will it cost?
The cost of a college education varies wildly. Annual tuition and fees can run $8,000, and as high as $50,000.* Take either number (or one in between) and multiply it by four years, and it’s only the beginning. You may need to pay for separate housing, a car, gas, parking or maybe air travel a few times a year. Textbooks can also run over $1,000 a year. You can also find great information here.
The earlier you start, the easier it is.
More parents are finding it difficult to fund their children’s college education. As a result, many students are taking on more debt – and having to repay college loans right after graduation. The answer? Start saving early. There are also special accounts specifically designed to help you save for college. The two most popular are the Coverdell Educational Savings Account (ESA) and the 529 College Savings Plan. They’re both tax-advantaged ways to grow your money. Start by working with a Financial Advisor located at Marine Federal Credit Union today!
A representative of Marine Federal Financial Group serving Marine Federal Credit Union is available to learn about your goals and work with you on your plan. Together, you’ll create a future that will make those financial plans a reality.
Securities sold, advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor. CBSI is under contract with the financial institution to make securities available to members. Not NCUA/NCUSIF/FDIC insured, May Lose Value, No Financial Institution Guarantee. Not a deposit of any financial institution. CBSI is a registered broker/dealer in all fifty states of the United States of America. The representative may also be financial institution employee that accepts deposits on behalf of the financial institution.