Retirement http://www.wisebread.com/taxonomy/term/417/all en-US Why Taking Social Security Could Cost You Thousands http://www.wisebread.com/why-taking-social-security-could-cost-you-thousands <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/why-taking-social-security-could-cost-you-thousands" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/social-security-finance-Dollarphotoclub_37675746.jpg" alt="social security" title="social security" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>I recently attended a weekend barbecue with some neighbors, and at one point the conversation shifted from the usual topics &mdash; family updates, local news, sports, and politics &mdash; to retirement. Strangely enough, it was raised by a friend's daughter, Barbara, who is in her early 30s. I was a little surprised (but encouraged) that she was already doing some retirement planning at that age.</p> <p>Barbara is a bright, hard-working human resources manager with a promising future, but after 10 years in a challenging work environment, she said she was beginning to feel a little fatigued. That's certainly understandable. She and another 80 million millennials have had the misfortune of joining a workforce that's experiencing some major disruptions. For most workers, America's recent economic restructuring has led to less job security, lower wages, fewer benefits, and longer hours. That's not exactly a recipe for long-term optimism if you're a thirty-something.</p> <p>With this in mind, it didn't take long for me to realize that Barbara raised the issue of retirement not because she was interested in long term financial planning, but instead out of sheer frustration. Barbara's question was, &quot;What is the earliest age I can begin receiving my Social Security retirement benefit?&quot; Age 62 was the answer. &quot;Then that's when I'll take it,&quot; she said.</p> <p><a href="http://www.socialsecurity.gov/planners/benefitcalculators.htm"><img width="605" height="340" src="http://www.wisebread.com/files/fruganomics/u5123/Whelan%20Blog%20Table%20-%20Social%20Security%20Benefit%20Reductions.jpg" alt="" /></a></p> <p>What Barbara didn't realize is that by doing so, she'd forfeit 30% of her full benefit amount. If her full amount was, say, $2,000 per month, then she would be giving up $600. So I said to her, &quot;What if you needed $2,000 a month from Social Security just to break even financially? And what if, by taking your Social Security benefit at age 62 instead of age 67, your benefit amount is reduced by $600 a month, to $1,400?&quot; Barbara's reply: &quot;I'd still take the lower amount.&quot;</p> <p>Of course I couldn't just let the issue end there, so I asked a follow-up question: &quot;But that would put you $7,200 in the hole each year. By your mid 70s your debt would add up to $100,000. How would you pay for it?&quot; &quot;I don't care,&quot; she said. &quot;I just want to stop working the moment I first qualify for a monthly retirement check.&quot;</p> <p>At that point I sensed I was stepping on a nerve, so I let it go. But, I'm glad she raised the topic and I give her credit for starting the conversation. Now that the issue has been framed with real numbers and dates, she is in a better position to make a sound decision when the time comes.</p> <p>For some, the loss of $600 each month for the duration of their retirement would be difficult to absorb. For others, it would be less of an issue. And for others still, there might be health-related concerns or other extenuating circumstances that make early distribution a reasonable choice.</p> <p>The point is, before choosing to give away so much of what you earned and accumulated over many decades, be sure to consider the trade-offs. Let reason, not emotion, drive your decision.</p> <p><em>At what age are you planning on taking Social Security?</em></p> <a href="http://www.wisebread.com/why-taking-social-security-could-cost-you-thousands" class="sharethis-link" title="Why Taking Social Security Could Cost You Thousands" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/keith-whelan">Keith Whelan</a> of <a href="http://www.wisebread.com/why-taking-social-security-could-cost-you-thousands">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-much-do-i-need-to-retire-how-much-can-i-spend">How much do I need to retire? How much can I spend?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/tiny-nestegg-retire-abroad">Tiny Nestegg? Retire abroad!</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-things-you-didnt-know-about-retirement">12 Things You Didn&#039;t Know About Retirement</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-end-of-the-4-rule">The End of the 4% Rule?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/book-review-early-retirement-extreme">Book Review: Early Retirement Extreme</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement early retirement pension social security Fri, 23 Jan 2015 14:00:06 +0000 Keith Whelan 1282530 at http://www.wisebread.com 5 Reasons to Fire Your Financial Adviser Soon http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-reasons-to-fire-your-financial-adviser-soon" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/woman-in-charge.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>As&nbsp;2014 gives way to 2015, you&rsquo;ll likely be reviewing your investment results for the year, and looking ahead to this year and beyond. So here&rsquo;s a question you may want to ask: Should I fire my&nbsp;<a href="http://www.nextavenue.org/article/2012-08/evaluating-your-financial-advisor">financial adviser</a>?<br /> &nbsp;<br /> That may sound like a nutty question, since the stock market has been gangbusters, with a positive year for the sixth year in a row. That performance doesn&rsquo;t necessarily mean your money pro has delivered enough value to justify your keeping him or her, though.<br /> &nbsp;<br /> Below are five questions you&rsquo;ll want to ask to help you determine whether you should give your adviser the heave-ho sooner rather than later. If you answer &ldquo;yes&rdquo; to any of them, it&rsquo;s time to look for a replacement.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2013-10/how-find-financial-advice-you-can-trust">How to Find Financial Advice You Can Trust</a>)<br /> &nbsp;<br /> <strong>Question 1: Did you receive a year-end performance report?&nbsp;</strong><br /> &nbsp;<br /> No report?&nbsp; Fire your adviser.<br /> &nbsp;<br /> Real advisers provide performance reports. Financial&nbsp;<em>salesmen</em>&nbsp;don&rsquo;t. Their sales licenses do not permit them to provide this type of ongoing reporting.<br /> &nbsp;<br /> <strong>Question 2:</strong>&nbsp;&nbsp;<strong>Did your adviser provide a report that disclosed all the expenses deducted from your investment accounts?</strong><br /> &nbsp;<br /> No? Fire your adviser for withholding information from you. You can&rsquo;t trust an adviser who doesn&rsquo;t display full transparency.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2012-08/evaluating-your-financial-advisor">Evaluating Your Financial Adviser</a>)</p> <p><strong>Question 3. At some point, the stock market will have a correction (less than a 15 percent loss and six months of duration) or turn into a bear market (more than a 15 percent loss and six months of duration). Does your adviser have a strategy for minimizing your risk of large losses?</strong><br /> &nbsp;<br /> No plan? Fire the adviser. Select one who can help you preserve your assets during a market that produces negative returns.<br /> &nbsp;<br /> <strong>Question 4: Has your adviser provided a document certifying that he or she is acting in a fiduciary capacity when providing financial advice and services?</strong><br /> &nbsp;<br /> No document? Fire the adviser.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2012-03/when-your-financial-adviser-guessing">When Your Financial Adviser Is Guessing</a>)<br /> &nbsp;<br /> Fiduciaries are held to the highest ethical standards in the financial service industry. They&rsquo;re&nbsp;<em>required</em>&nbsp;to put your financial interests ahead of their own. Non-fiduciaries are salesmen who are held to lower ethical standards that don&rsquo;t require them to put your interests first.<br /> &nbsp;<br /> <strong>Question 5: The financial services industry is riddled with conflicts of interest. Has your adviser provided a written statement saying that his or her advice is free of any potential conflicts of interest that could damage your financial interests?</strong><br /> &nbsp;<br /> Fire any adviser who refuses to provide this statement. You don&rsquo;t have to know what he or she is hiding or why. You just have to know there&rsquo;s the potential to damage you.<br /> &nbsp;<br /> Conflicts of interest are not obvious or easy to detect. In most cases, they&rsquo;re designed to achieve one goal: maximize the revenue of the seller. They are extremely dangerous because Wall Street&rsquo;s marketing experts know how to package toxic products and convince you that they are safe investments. Some banks and insurers sell inferior products with excessive expenses that maximize their revenues, profits, and share prices.<br /> &nbsp;<br /> The most dangerous conflict is from an unscrupulous, but friendly adviser who develops a personal relationship with you. Once trust is established, such advisers can sell customers the financial products that make them and their firms the most money. The most frequent lament from Bernie Madoff&rsquo;s clients was: &ldquo;I thought he was my friend.&rdquo;<br /> &nbsp;<br /> Always remember: the investment of your assets should be based on a&nbsp;<em>business</em>&nbsp;relationship, not a personal relationship. Fire advisers who want to be judged on their relationship skills, not their results and transparency.</p> <div class="field field-type-text field-field-blog-teaser"> <div class="field-items"> <div class="field-item odd"> Many of Bernie Madoff&#039;s clients said &quot;I thought he was my friend.&quot; Find out if your adviser is a friendly, but unscrupulous salesman and not the ethical adviser he should be. </div> </div> </div> <div class="field field-type-text field-field-guestpost-blurb"> <div class="field-label">Guest Post Blurb:&nbsp;</div> <div class="field-items"> <div class="field-item odd"> <p><em>Jack Waymire spent 28 years in the financial services industry. He is the founder of </em><a href="http://www.paladinregistry.com/"><em>Paladin Research and Registry</em></a><em>, which provides free tools and information to investors who use financial advisers. Follow him on Twitter </em><a href="https://twitter.com/PaladinRegistry"><em>@PaladinRegistry</em></a><em> or connect with him on </em><a href="https://plus.google.com/+JackWaymire/posts"><em>Google+</em></a><em>.&nbsp;<em style="color: rgb(0, 0, 0); font-family: Arial, Helvetica, sans-serif; font-size: 12.7272720336914px; line-height: 1.5;">Check out more great articles from PBS's </em><a href="http://www.nextavenue.org"><em>Next Avenue</em></a>:</em></p> <ul> <li><a href="http://www.nextavenue.org/article/2014-07/27-ways-trick-yourself-saving-money">27 Ways To Tricking Yourself Into Saving Money</a></li> <li><a href="http://www.nextavenue.org/article/2012-07/biggest-retirement-mistake-boomers-make-and-how-avoid-it">The Biggest Retirement Mistakes Boomers Make</a>&nbsp;</li> <li><a href="http://www.nextavenue.org/article/2014-11/3-retirement-rules-thumb-really-work">3 Retirement Rules of Thumb that Really Work</a></li> </ul> </div> </div> </div> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/next-avenue">Next Avenue</a> of <a href="http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-occasions-when-you-should-definitely-hire-a-financial-advisor">7 Occasions When You Should Definitely Hire a Financial Advisor</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-this-hidden-cost-sapping-your-retirement-savings">Is This Hidden Cost Sapping Your Retirement Savings?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/intimidated-by-retirement-investing-get-professional-help">Intimidated by Retirement Investing? Get Professional Help!</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-know-what-annuities-are-you-might-be-missing-out">Don&#039;t Know What Annuities Are? You Might Be Missing Out</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-trust-your-money-with-these-4-popular-financial-robo-advisers">Should You Trust Your Money With These 4 Popular Financial Robo-Advisers?</a></span> </div> </li> </ul> </div> </div> </div> </div> Investment Retirement financial adviser financial planning next avenue retirement Fri, 16 Jan 2015 18:00:08 +0000 Next Avenue 1280353 at http://www.wisebread.com 9 Changes That Will Affect Your Money in 2015 http://www.wisebread.com/9-changes-that-will-affect-your-money-in-2015-0 <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/9-changes-that-will-affect-your-money-in-2015-0" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/looking-to-future.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>As we start 2015, I wanted to pass along&nbsp;nine changes that&rsquo;ll affect&nbsp;your money&nbsp;next year so you can factor them into your financial plans:</p> <p><strong>1. You&rsquo;ll be allowed to stash more money into some types of retirement plans.&nbsp;</strong></p> <p>The maximum contribution limit for&nbsp;<a href="http://www.irs.gov/uac/Newsroom/IRS-Announces-2015-Pension-Plan-Limitations;-Taxpayers-May-Contribute-up-to-$18,000-to-their-401%28k%29-plans-in-2015" target="_blank">401(k) and 403(b)</a>&nbsp;employer-sponsored plans will rise by $500 to $18,000 if you&rsquo;ll be under 50 and to $24,000 (a $6,000 catch-up) if you&rsquo;ll be 50 or older. Those&nbsp;<a href="http://www.nextavenue.org/article/2014-01/5-best-money-strategies-boomers">catch-up contribution</a>&nbsp;boosts for people 50+ are overdue; the catch-up amount has been stuck at $5,550 for a few years.<br /> &nbsp;<br /> Similarly, the maximum contribution for a&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Choosing-a-Retirement-Plan:-SIMPLE-401%28k%29-Plan" target="_blank">SIMPLE 401(k)</a>or a&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-SIMPLE-IRA-Contribution-Limits" target="_blank">SIMPLE IRA</a>&nbsp;&mdash; the type of plans often used by small companies &mdash; will also go up by $500, to $12,500 for those under 50 and to $15,500 (or a $3,000 catch-up) for those 50 and older.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2014-11/7-smart-year-end-tax-moves-prepare-2015">7 Year-End Tax-Saving Moves</a>)<br /> &nbsp;<br /> The news is better still for the self-employed or small business owners who plan to fund&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Retirement-Plans-FAQs-regarding-SEPs-Contributions" target="_blank">SEP IRAs</a>&nbsp;or&nbsp;<a href="http://www.irs.gov/Retirement-Plans/One-Participant-401%28k%29-Plans" target="_blank">Solo 401(k)s</a>&nbsp;in 2015: they&rsquo;ll be allowed to invest $1,000 more than in 2014. The 2015 limit: a bountiful $53,000.</p> <p>&ldquo;In general, we prefer the SEP IRA to a Solo 401(k), because of its overall simplicity,&rdquo; says Joshua Kadish, of the RPG Life Transition Specialists wealth management firm in Chicago, Ill.<br /> &nbsp;<br /> <strong><strong>2. You might finally be able to save for retirement through the Obama Administration&rsquo;s new&nbsp;<a href="https://myra.treasury.gov/" target="_blank">myRA</a>&nbsp;option</strong>.&nbsp;</strong></p> <p>Remember when the President announced this account (myRA, which rhymes with IRA, is short for &ldquo;my retirement account&rdquo;) in his 2014&nbsp;<a href="http://www.nextavenue.org/blog/state-union-and-older-americans">State of the Union&nbsp;</a>address? Well, it&rsquo;s still not available, but will be &mdash; for some people &mdash; &nbsp;in 2015.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2014-12/5-smart-tax-savers-year-end-charitable-giving">Tax Savers for Year-End Charitable Giving</a>)<br /> &nbsp;<br /> The government is now working with a small group of employers participating in a pilot phase of the program. A U.S. Department of Treasury spokesperson told me: &ldquo;Treasury looks forward to working with these employers to refine myRA before it becomes more broadly available in 2015.&rdquo;<br /> &nbsp;<br /> A myRA will be a no-fee Roth IRA for people whose employers don&rsquo;t currently offer retirement plans. The federal government will guarantee myRA income (through special retirement savings bonds) and employee aftertax contributions will be made through payroll deductions. Contributions won&rsquo;t be tax-deductible, but interest earnings will grow tax-free and withdrawals won&rsquo;t be taxed. MyRAs will be limited to individuals with income below $129,000 and to couples with incomes under $151,000.<br /> &nbsp;<br /> There&rsquo;ll be a $15,000 limit on the amount you can accumulate in a myRA over 30 years; after that, the money must be transferred to a Roth IRA account managed by a financial services firm.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/blog/top-10-medical-innovations-2015" target="_blank">Top 10 Medical Innovations for 2015</a>)<br /> &nbsp;<br /> &ldquo;I&rsquo;m not ready to say that everyone should jump on board for a myRA,&rdquo; says Kadish. &ldquo;There may be a benefit for having a tax deductible IRA instead, if you qualify. With a standard Roth IRA, you have 100 percent control over how the money is invested.&rdquo;</p> <p><strong>3. Beginning in 2015, you&rsquo;ll be limited on the number of&nbsp;<a href="http://www.irs.gov/Retirement-Plans/IRA-One-Rollover-Per-Year-Rule" target="_blank">nontaxable IRA rollovers</a>&nbsp;you can make.&nbsp;</strong></p> <p>The Internal Revenue Service will cap them to one every 12 months. The government is doing this to crack down on the loophole that let people effectively get short-term, interest-free loans by taking money out of their IRAs and then depositing the cash into new retirement accounts.<br /> &nbsp;<br /> <strong>4. The income limit to claim the&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-Retirement-Savings-Contributions-Credit-%28Saver%E2%80%99s-Credit%29" target="_blank">Saver&rsquo;s Credit</a>&nbsp;will rise a bit, too</strong>.</p> <p>In 2015, it&rsquo;ll be boosted by $1,000 for married couples filing jointly (to adjusted gross income of $61,000) and by $500 for singles (to $30,500). This&nbsp;<a href="http://www.nextavenue.org/article/2014-12/uncle-sam-may-want-give-you-2000-retirement">little-known credit</a>&nbsp;lets qualifying taxpayers get a tax break for contributing to 401(k)s and IRAs.<br /> &nbsp;<br /> <strong><strong>5. The&nbsp;<a href="http://taxfoundation.org/article/2015-tax-brackets" target="_blank">standard deduction</a>&nbsp;will go up by $100 for singles (to $6,300) and by $200 for married couples filing jointly (to $12,600).</strong>&nbsp;</strong></p> <p>As you likely know, you&rsquo;ll be able to itemize your deductions if they&rsquo;ll exceed the standard deduction.</p> <p><strong><strong>6. There&rsquo;ll be teeny increases in the&nbsp;<a href="http://www.irs.gov/uac/Newsroom/In-2015,-Various-Tax-Benefits-Increase-Due-to-Inflation-Adjustments" target="_blank">personal exemption</a>&nbsp;and the amount you can save in a&nbsp;<a href="http://www.irs.gov/uac/Newsroom/In-2015,-Various-Tax-Benefits-Increase-Due-to-Inflation-Adjustments" target="_blank">Flexible Spending Account</a>&nbsp;(FSA) in 2015.</strong>&nbsp;</strong></p> <p>Both will inch up by $50: The personal exemption will be $4,000 (though it&rsquo;ll phase out for singles whose incomes will be $258,250 or higher and for married couples filing jointly with incomes of $309,900 or more). The FSA limit rises to $2,500 next year.</p> <p><strong><strong>7. The&nbsp;<a href="http://taxfoundation.org/article/2015-tax-brackets" target="_blank">Alternative Minimum Tax exemption</a>&nbsp;will go up by about 1.5 percent next year.</strong></strong></p> <p>The exemption amount will be $53,600 for individuals and $83,400 for married couples filing jointly.</p> <p><strong>8. Social Security payments will nudge up, but so will the amount of income subject to Social Security taxes.&nbsp;</strong></p> <p>Benefits checks for the nation&rsquo;s 58 million Social Security recipients will rise by 1.7 percent in 2015, due to the annual&nbsp;<a href="http://www.ssa.gov/news/press/factsheets/colafacts2015.html" target="_blank">Cost of Living Adjustment</a>. That amounts to roughly $22 a month, on average, according to AARP.<br /> &nbsp;<br /> That 1.7 percent increase is a smidge higher than the coming 1.3 percent rise ($1,500) in the portion of income that&rsquo;ll be subject to Social Security tax in 2015. The income ceiling will be $118,500, up from $117,000 in 2014.<br /> &nbsp;<br /> <strong>9. The Obamacare penalty for not having health insurance in 2015 will more than triple</strong>.</p> <p>In 2014, the&nbsp;<a href="https://www.healthcare.gov/fees-exemptions/fee-for-not-being-covered/" target="_blank">Obamacare penalty</a>&nbsp;was $95 per adult or 1 percent of income, whichever was greater; in 2015, it&rsquo;ll shoot up to $325 per adult or 2 percent of income.</p> <p><strong>What Will Be the Same in 2015</strong><br /> &nbsp;<br /> Two things that won&rsquo;t change: the annual&nbsp;<a href="http://www.forbes.com/sites/ashleaebeling/2014/10/30/irs-announces-2015-estate-and-gift-tax-limits" target="_blank">gift tax exclusion</a>&nbsp;(still $14,000) and the&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-IRA-Contribution-Limits" target="_blank">limits for traditional and Roth IRAs</a>&nbsp;(still $5,500 if you&rsquo;re under 50 and $6,500 if you&rsquo;re 50 or older).</p> <p>&ldquo;The lack of an increase in the IRA limits flies in the face of everything we&rsquo;re hearing about people living longer and needing to save more,&rdquo; says Kadish. &ldquo;There&rsquo;s no rhyme or reason to it.&rdquo;</p> <div class="field field-type-text field-field-blog-teaser"> <div class="field-items"> <div class="field-item odd"> Several retirement contribution limits are raised, Obamacare penalty triples, myRA officially launches and many more tax and social security changes. </div> </div> </div> <div class="field field-type-text field-field-guestpost-blurb"> <div class="field-label">Guest Post Blurb:&nbsp;</div> <div class="field-items"> <div class="field-item odd"> <p><em>Richard Eisenberg is the senior Web editor of the Money &amp; Security and Work &amp; Purpose channels of <a href="http://www.nextavenue.org/">Next Avenue</a> and Assistant Managing Editor for the site. Follow him on Twitter </em><a href="http://twitter.com/richeis315"><em>@richeis315</em></a><em>. Check out more great articles from Next Avenue:</em></p> <ul> <li><a href="http://www.nextavenue.org/blog/best-places-retire-abroad-2015">The Best Places to Retire Abroad in 2015</a></li> <li><a href="http://www.nextavenue.org/blog/surprising-secrets-successful-retirees">The Surprising Secrets of Successful Retirees</a></li> <li><a href="http://www.nextavenue.org/article/2015-01/3-health-resolutions-you-can-actually-keep-2015">3 Health Resolutions You Can Actually Keep in 2015</a></li> </ul> </div> </div> </div> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/next-avenue">Next Avenue</a> of <a href="http://www.wisebread.com/9-changes-that-will-affect-your-money-in-2015-0">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-choose-a-roth-401k-or-a-regular-401k">Should You Choose a Roth 401k or a Regular 401k?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-tax-moves-you-need-to-make-right-now">6 Tax Moves You Need to Make Right Now</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/tax-penalties-for-early-retirement-withdrawals">Tax Penalties for Early Retirement Withdrawals</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-great-places-to-get-free-tax-advice">6 Great Places to Get Free Tax Advice</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/tax-document-checklist-what-to-gather-before-doing-your-taxes">Tax Document Checklist: What to Gather Before Doing Your Taxes</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement Taxes Wed, 14 Jan 2015 16:00:10 +0000 Next Avenue 1280157 at http://www.wisebread.com 4 Times Raiding Your Retirement Accounts Early Is Okay http://www.wisebread.com/4-times-raiding-your-retirement-accounts-early-is-okay <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-times-raiding-your-retirement-accounts-early-is-okay" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/retired-couple-finances-Dollarphotoclub_46844243.jpg" alt="retired couple finances" title="retired couple finances" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Borrowing from your retirement accounts should rarely be your first choice to cover unexpected expenses. Even if your need is severe, there are often better and cheaper ways that won't narrow your future.</p> <p>But the truth is that there are times when getting a loan from your retirement account isn't the worst choice you can make. If you're in one of the following situations, a loan from your retirement account might actually be a reasonable solution.</p> <h2>1. You're Facing Severe Financial Hardship</h2> <p>By &quot;severe financial hardship,&quot; I'm thinking the extreme of extremes here. If you're not sure you can keep the lights on or feed your family, a retirement loan is probably better than your alternatives.</p> <p>Even in this situation, though, you need to have a plan. Retirement loans must be repaid, and the money usually comes directly out of your paycheck. If you're not getting a regular paycheck, you need to figure out how to repay the money. You will also want to consider whether you want a &quot;hardship&quot; loan or a regular one. If you can prove the hardship, those loans are usually easier and faster but, depending on your company, they may have other drawbacks.</p> <h2>2. It Is Your Low-Cost Option</h2> <p>If you've calculated the costs of all of your loan options, and a loan from your retirement accounts is the cheapest option, then you need to consider taking it. However, it's important to remember that you cannot ever calculate the cost of a retirement loan accurately, because you don't know how much more money your retirement funds would have earned if you had left them in the account the whole time.</p> <p>Both <a href="http://money.usnews.com/money/blogs/alpha-consumer/2011/01/25/why-401k-loans-can-be-a-smart-move">credit card debt</a> and <a href="http://powertochange.com/world/paydayloan/">payday</a> loans are examples of potentially very high interest loans that could potentially be paid off cheaper with a retirement loan. It's often possible, though, to negotiate your credit card payments lower, or even to negotiate a lower amount that you can pay off instead of the total. Try these options before you take out a retirement loan.</p> <h2>3. You Can't Get a Regular Loan</h2> <p>If you have a bankruptcy or even a short sale on your financial record, your credit may be too low to even be able to get a conventional loan. If there's not another way to get the money that you need and you can't put off your need until later, then a loan from your retirement account may be what you need to get you through.</p> <p>Be sure that you're taking the overall tax situation into account when you consider this, though. You'll be charged a penalty for taking the money out, and the money may be taxed as income, too. Then, once it's repaid and you're taking it out for retirement, you may pay taxes on it again. Talk to someone about the specifics of your situation, so you know exactly what you're getting into. Unless your need is so urgent you cannot wait on a regular loan, all of this may be too much to pay!</p> <h2>4. You Are Making the Best Investment&hellip; Ever!</h2> <p>The most-controversial-but-still-probably-ok reason to take money out of your retirement accounts before retirement age is because you're making some kind of insane investment. Are you financing a business or putting yourself through school? Then the loan might be acceptable.</p> <p>As always, calculate the costs of the loan as best you can. While you can't absolutely calculate how much money you will make from a business or how much more you'll make with further education, do your research. If you're not going to improve your situation significantly or you find you can get a low-interest education loan instead, you're probably better off leaving your retirement money where it is.</p> <h2>Considerations Before You Take Out a Retirement Loan</h2> <p>Sure, there are times when a retirement loan is your best option. While it's never a great choice, it's a better choice when the following things are true.</p> <h3>When Your Retirement Is Already Secure</h3> <p>Do you know how much you plan on needing for retirement? Do you already have that, and more? If you know your retirement is secure, then a loan from those accounts that doesn't dip into the money you will need is a better choice than when you're taking money from your future self.</p> <h3>When You Love Your Job</h3> <p>Since retirement loans have to be repaid, it's always better to take one out when you're <a href="http://www.bankrate.com/finance/retirement/4-reasons-to-take-out-a-401k-loan-4.aspx">working a job you love</a> (and believe they plan to keep you there for a quite a while). If you want to quit &mdash; or you think you might get laid off or fired &mdash; a retirement loan is much more risky, since most companies will require you to pay off the entire balance within 60 days of your employment termination.</p> <h3>When You Need Money Fast</h3> <p>As long as you have the proper paperwork in place, you can usually get a loan from your retirement accounts fairly quickly. Since you won't have to apply or be approved, the process is more streamlined than with other loans. Sometimes, you won't have time to research all of your options or wait to hear back from a lender before you need your money, and in this case retirement loans can be your best choice.</p> <h3>When Your Need Is Short Term</h3> <p>If your retirement account loan is longer in duration, the negative effect on your retirement funds only grows. If, on the other hand, you take it out and can repay it in full in a matter of a few months, you've done minimal damage and covered your financial needs. In general, <a href="http://www.forbes.com/sites/learnvest/2014/03/28/the-skinny-on-borrowing-money-from-your-401k/2/">if your financial need will be over in less than a year</a> and you can repay the money quickly at that point, a retirement loan is a better idea than it is if you will have to repay it slowly over years and years.</p> <p><em>Have you ever taken a loan from your retirement accounts? How did it work out for you?</em></p> <a href="http://www.wisebread.com/4-times-raiding-your-retirement-accounts-early-is-okay" class="sharethis-link" title="4 Times Raiding Your Retirement Accounts Early Is Okay" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/sarah-winfrey">Sarah Winfrey</a> of <a href="http://www.wisebread.com/4-times-raiding-your-retirement-accounts-early-is-okay">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/you-may-be-putting-your-retirement-money-in-the-wrong-place">You May Be Putting Your Retirement Money in the Wrong Place</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-one-thing-will-get-you-to-1-million-tax-free">This One Thing Will Get You to $1 Million (Tax-Free!)</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-silly-reasons-people-dont-invest-but-should">9 Silly Reasons People Don&#039;t Invest (But Should)</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-is-why-you-cant-postpone-planning-for-your-retirement-and-how-to-start">This Is Why You Can&#039;t Postpone Planning for Your Retirement (And How to Start)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/money-resolutions-6-ways-to-take-control-in-2013">Money Resolutions: 6 Ways to Take Control in 2013</a></span> </div> </li> </ul> </div> </div> </div> </div> Investment Retirement 401(k) retirement saving saving Mon, 12 Jan 2015 14:00:09 +0000 Sarah Winfrey 1277863 at http://www.wisebread.com 4 Exciting World Cities You Can Afford to Retire In http://www.wisebread.com/x-exciting-world-cities-you-can-afford-to-retire-in <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/x-exciting-world-cities-you-can-afford-to-retire-in" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/mature-couple-travel-biking-Dollarphotoclub_66958635.jpg" alt="mature couple travel" title="mature couple travel" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Hello pension, goodbye tension!</p> <p>You've worked hard, so it makes perfect sense to reward yourself in your retirement years. For some people, the easiest way to afford a comfortable retirement is to jump on a plane and go abroad. (See also: <a href="http://www.wisebread.com/this-is-the-basic-intro-to-having-a-retirement-fund-that-everyone-needs-to-read">This Is the Basic Intro to Having a Retirement Fund That Everyone Needs to Read</a>)</p> <p>Living better for less, having access to generous tax breaks, and enjoying beautiful locales and ideal weather conditions are some of the benefits of living abroad. Here are four international cities to consider retiring in.</p> <h2>1. Panama City, Panama</h2> <p><img width="605" height="340" src="http://www.wisebread.com/files/fruganomics/u5123/panama%20city.jpg" alt="" /></p> <p>When considering retiring abroad, most people think that they have to travel halfway across the world to find the perfect spot. Panama City proves that this is not always the case. Located just a short two and half hour flight from Miami, Panama City has nonstop flight options from four other U.S. cities, such as Atlanta, Denver, Houston, and Newark. In fact, it's such a hot destination for retirees that the <a href="https://hub.united.com/en-us/news/company-operations/pages/united-nonstop-service-den-pty.aspx">Denver flight started in December 2014</a> to accommodate more U.S. travelers.</p> <p>Panama allows U.S. retirees with a Social Security pension of at least $1,000 per month to become permanent residents. <a href="http://internationalliving.com/countries/panama/retire/">Benefits from this visa program</a> include 50% off entertainment (such as movies and sporting events), 25% off airline tickets, 15% off hospital bills, and 50% off closing costs for home loans. Once you qualify for Panama's &quot;pensionado&quot; visa program, you never have to renew your status.</p> <h2>2. Cuenca, Ecuador</h2> <p><img width="605" height="340" src="http://www.wisebread.com/files/fruganomics/u5123/cuenca%20ecuador.jpg" alt="" /></p> <p>Cuenca offers several advantages to U.S. retirees, including the fact that Ecuador's official currency is the U.S. dollar. This means that you don't have to worry about conversion rates and can have an easier time budgeting expenses.</p> <p>Another major plus is Cuenca's low cost living. English-speaking retired couples in Cuenca report living comfortably for <a href="http://internationalliving.com/2014/01/the-best-places-to-retire-2014/">about $1,500 to $1,800 a month</a>. Some publications report the average monthly rent around $300 to $400. Given the small size of the city, you don't need to buy a car. Traveling by taxi is about $2 to $3 per trip. Plus, retirees can <a href="http://www.josephle.com/blog/how-to-get-your-vat-value-added-tax-refund-in-ecuador-for-foreign-tourists">get back the 12% value added tax</a> on qualifying goods and services purchased in Ecuador.</p> <p>The weather is also great. Cuenca is located in the sierra (highlands) region and maintains an average daytime temperature of 75 degrees Fahrenheit. This spring-like climate minimizes your need for air conditioning and heating, effectively reducing your electricity bill.</p> <p>History and culture buffs love that Cuenca is a <a href="http://whc.unesco.org/en/list/863">UNESCO World Heritage Trust site</a>. Surrounded by Spanish colonial architecture, Cuenca offers rich intellectual and artistic experiences year round. Additionally, there are several opportunities for domestic travel. Ecuador has a very diverse geography and offers beaches (such as Salinas and Manglaralto), islands (the famous Galapagos Islands), rainforests, and much more.</p> <h2>3. Malaga, Spain</h2> <p><img width="605" height="340" src="http://www.wisebread.com/files/fruganomics/u5123/malaga%20spain.jpg" alt="" /></p> <p>The ongoing economic woes of the European Union have made retiring in the Old World suddenly a more feasible prospect for American retirees. Spain stands out from other European nations because it offers affordable real estate that can compete with prices found in Latin America. For example, you can find a one-bedroom apartment in Malaga's historic center <a href="http://internationalliving.com/2014/12/affordable-coastal-living-in-malaga-enjoy-a-high-quality-of-life-for-less-in-one-of-spains-best-value-cities/">starting at $182,000</a>. Or, you can rent a nice place for <a href="http://www.cbsnews.com/media/worlds-10-best-cities-to-retire-on-a-budget/2/">about $950 per month</a>.</p> <p>Besides its attractive real estate market and <a href="http://www.numbeo.com/cost-of-living/city_result.jsp?country=Spain&amp;city=Malaga">low cost of living</a>, Malaga provides retirees a great balance between big city life and laidback charm. The city is chock-full of art installations and exhibitions &mdash; after all, the world-famous artist Picasso was born there. Malaga is also the gateway to the Costa del Sol (literally, the &quot;Coast of the Sun&quot;), which offers several beaches within driving distance.</p> <p>Malaga's cuisine has Spanish, Jewish, and Arabic influences. This eclectic mix makes eating in Malaga a great experience for foodies. On long summer evenings, you can enjoy great food in outdoor restaurants well past midnight.</p> <h2>4. Penang Island, Malaysia</h2> <p><img width="605" height="340" src="http://www.wisebread.com/files/fruganomics/u5123/penang%20island.jpg" alt="" /></p> <p>If your idea of retiring abroad involves exotic destinations, then Penang Island in Malaysia may be the right choice for you. Just like Panama, Malaysia offers a visa pension program (known as <a href="http://www.mm2h.gov.my">Malaysia My Second Home</a>, renewable every five to 10 years) that offers several benefits, such as help for importing your car and household items for virtually nothing, transporting your pet, and hiring a live-in housekeeper.</p> <p>English is the official second language of Malaysia, facilitating communication. There are plenty of English-speaking locals and the estimated expat population is above 40,000, according to expat organizations such as the <a href="http://www.klamerican.com">American Association of Malaysia</a>.</p> <p>Hospital facilities in Malaysia have such an excellent reputation that &quot;medical tourism&quot; is a driving economic force. Retirees report that many doctors and dentists are trained in the U.S. or UK and that appointments cost as little as $11.</p> <p>Retiring abroad isn't for everyone. It requires a love for adventure and a passion for the lifestyle of your retirement haven. Before making a permanent move overseas, consider spending at least three to six months visiting. If the benefits keep you charmed during that trial period, you can be confident you're making the right decision.</p> <p><em>Are you planning to retire abroad? Where?</em></p> <a href="http://www.wisebread.com/x-exciting-world-cities-you-can-afford-to-retire-in" class="sharethis-link" title="4 Exciting World Cities You Can Afford to Retire In" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/x-exciting-world-cities-you-can-afford-to-retire-in">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-incredible-places-to-retire-abroad-that-anyone-can-afford">5 Incredible Places to Retire Abroad That Anyone Can Afford</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-you-on-this-list-of-cushiest-retirement-jobs">Are YOU on This List of Cushiest Retirement Jobs?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon">5 Reasons to Fire Your Financial Adviser Soon</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-choose-these-10-cities-if-you-want-to-retire-comfortably">Don&#039;t Choose These 10 Cities If You Want to Retire Comfortably</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-unexpected-jobs-with-insane-travel">10 Unexpected Jobs With Insane Travel</a></span> </div> </li> </ul> </div> </div> </div> </div> Career and Income Retirement retirement retiring abroad travel Fri, 09 Jan 2015 14:00:07 +0000 Damian Davila 1277447 at http://www.wisebread.com 4 Ways to Boost Your 401(k) Returns http://www.wisebread.com/4-ways-to-boost-your-401k-returns <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-ways-to-boost-your-401k-returns" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/businessmen-meeting-handshake-200402197-001-small.jpg" alt="businessmen meeting handshake" title="businessmen meeting handshake" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Employer-sponsored 401(k) plans are powerful retirement vehicles. Beyond empowering you to take the first (and perhaps most important) step toward retirement savings, 401(k) contributions are also made using pre-tax income, meaning they can reduce your current income tax obligation, too. (See also: <a href="http://www.wisebread.com/if-you-want-your-401k-to-grow-stop-doing-these-6-things?ref=seealso">If You Want Your 401(k) to Grow, Stop Doing These 6 Things</a>)</p> <p>But the benefits of 401(k) plans don't end there &mdash; consider these additional ways to power charge your plan for maximum returns.</p> <h2>1. Get a Full Company Match</h2> <p>The most attractive benefit of 401(k)s is that most corporations match some percentage of your contributions, up to 6% of your salary. Let's say you earn $50,000 per year, and your company matches 100% of your contributions, up to 6% of your salary. That's a $3,000 per year match &mdash; or in other words, it's $3,000 in free money. Of course, not all companies offer such generous matches, but consider contributing as much as your company will match in order to maximize this source of free retirement money.</p> <h2>2. Choose Low-Fee Funds</h2> <p>The fees you pay on your investments can seriously erode your earnings. The SEC notes that even a 1% annual fee paid on a $100,000 portfolio will cost you $28,000 over 20 years. Yikes! That's why keeping your fees low &mdash; by choosing passively managed index funds or ETFs, where possible &mdash; is so important. Not only do you get to keep more of your money, but you also get to enjoy the extra growth on that money, thanks to the effect of compounding. All 401(k) plan offerings are required to disclose their fees; aim to select offerings with fees below 1%.</p> <p>Actively managed mutual funds often have the highest fees, so check the fine print.</p> <h2>3. Diversify</h2> <p>401(k) plans offer hassle-free strategic investing, including the ability to diversify your investments in order to help reduce risk. Often, a major investment firm like TD Ameritrade, Vanguard, or T.Rowe Price manages the plan and has worked with your employer to offer a variety of options which enable you to diversify your investments. But it's up to you to make use of them.</p> <p>If you don't feel comfortable creating your own diversified set of selections, consider choosing a broad index fund or Target-Date Fund. The latter selects investments based on your expected retirement date, automatically adjusting for risk and return profiles over time. This enables you to capture many of the benefits of diversification, without actively selecting several funds.</p> <h2>4. Rollover 401(k) Plans When You Change Employers</h2> <p>Most of us change jobs (and even careers) throughout our lives, but frequent job-switching shouldn't prevent you from participating in a 401(k). And if and when you leave a job, you can rollover your plan's assets into your new company's 401(k). If you're moving to a role that doesn't offer a 401(k) (such as a small company, or self-employment), avoid paying huge early withdrawal fees by rolling over to an IRA within 60-days of cashing out.</p> <p>If you're considering job offers, take into account a company's benefits package. It is one of the most important things to consider next to compensation. Seek an employer that offers a 401(k), and preferably one that offers matched contributions. Without a strong retirement plan, you're likely just extending the number of years you'll need to work, so proceed accordingly.</p> <p><em>What are you doing to supercharge your 401(k)?</em></p> <a href="http://www.wisebread.com/4-ways-to-boost-your-401k-returns" class="sharethis-link" title="4 Ways to Boost Your 401(k) Returns" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/qiana-chavaia">Qiana Chavaia</a> of <a href="http://www.wisebread.com/4-ways-to-boost-your-401k-returns">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-to-keep-your-retirement-funds-from-disappearing">7 Ways to Keep Your Retirement Funds From Disappearing</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/choosing-a-retirement-account-whats-available-and-what-s-best-for-you">Choosing a Retirement Account: What&#039;s Available, and What’s Best for You?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-is-why-you-cant-postpone-planning-for-your-retirement-and-how-to-start">This Is Why You Can&#039;t Postpone Planning for Your Retirement (And How to Start)</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-one-thing-will-get-you-to-1-million-tax-free">This One Thing Will Get You to $1 Million (Tax-Free!)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/book-review-cash-rich-retirement">Book review: Cash-Rich Retirement</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement 401(k) investing retirement planning Thu, 04 Dec 2014 15:00:21 +0000 Qiana Chavaia 1263266 at http://www.wisebread.com Don't Choose These 10 Cities If You Want to Retire Comfortably http://www.wisebread.com/dont-choose-these-10-cities-if-you-want-to-retire-comfortably <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/dont-choose-these-10-cities-if-you-want-to-retire-comfortably" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/washington%20dc.jpg" alt="washington dc" title="washington dc" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Retirement is a time to enjoy hobbies, move a little slower in daily life, travel, and after decades of hard work, just rest. All of which is tough if you pick the wrong retirement city. (See also: <a href="http://www.wisebread.com/10-unexpected-things-you-should-consider-when-picking-where-you-retire?ref=seealso">10 Unexpected Things You Should Consider When Picking Where You Retire</a>)</p> <p>When looking at locations, you'll generally want to weigh six categories: cost of living, housing costs, taxes, the health care system, activities for seniors, and, yes, the weather. And with those in mind, you'll likely want to steer clear of these 10 cities that fall short in one or two or more of those categories.</p> <h2>1. San Francisco, CA</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/golden%20gate%20bridge.jpg" /></p> <p>The weather is very mild &mdash; it doesn't get hot in the summer and winters are usually rainy. However, the cost of housing in this area is so high that most retirees are not going to be able to find it within their budget. Retirement income is taxed heavily in the state of California, unlike many other states. The cost of living is also very high. In fact, Kiplinger ranked <a href="http://www.kiplinger.com/slideshow/retirement/T006-S001-worst-states-for-retirement/index.html">California as the worst state to retire</a>.</p> <h2>2. Honolulu, HI</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/honolulu.jpg" /></p> <p>While the location is beautiful and the weather gorgeous year round, Honolulu will require you to have quite a large nest egg. According to a recent <a href="http://wallethub.com/edu/best-places-to-retire/6165/">study done by WalletHub</a>, cost of living in the city are among the highest in the country. It's also very expensive to travel to and from Hawaii, making family gatherings more difficult.</p> <h2>3. Oklahoma City, OK</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/oklahoma%20city.jpg" /></p> <p>Healthcare is a concern for all seniors, and it will be a real concern if you retire to Oklahoma, which ranks among one of <a href="http://nhqrnet.ahrq.gov/inhqrdr/Oklahoma/snapshot/summary/All_Measures/All_Topics">the worst in the country for health care</a> (trailed only by West Virginia). Crime is also a problem here, with the city <a href="http://os.cqpress.com/citycrime/2013/2014_CityCrimeRankingsbyPopulation.pdf">ranking 7th in the nation</a> for crime among large cities.</p> <h2>4. Louisville, KY</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/louisville.jpg" /></p> <p>The low cost of living, modest housing costs, and picturesque mountains may make it appear to be a good choice for retirement, but Louisville has been named as the &quot;<a href="http://www.aafa.org/pdfs/FINAL_public_LIST_Spring_2014.pdf">worst place for allergy sufferers to live</a>,&quot; making it an easy destination to avoid by retirees with respiratory or other health issues.</p> <h2>5. Bridgeport, CT</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/bridgeport.jpg" /></p> <p>High taxes are a major concern for retirees, and some states tax retirement income much more than other states. (Florida's low rate is what makes it one of the most desirable states for retirees, for example.) But Connecticut is one of those states that taxes both Social Security and pension income. Bridgeport, more specifically, has expensive housing costs and even more expensive health care costs. Assisted living facilities in this area of the country can charge over over $400 a day &mdash; <a href="https://www.genworth.com/cost-of-care/landing.html">almost twice the national average</a> for long-term care, which will deplete your nest egg very quickly should you require assistance at some point.</p> <h2>6. New York, NY</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/new%20york%20city.jpg" /></p> <p>The Big Apple requires a big budget, as real estate is pricey and hard to afford on a fixed income. By taking your current retirement budget and adjusting it to the high cost of living for any of the more popular parts of NYC <a href="http://money.cnn.com/calculator/pf/cost-of-living/">via this calculator</a>, you can see that the real estate isn't the only thing that will cost you. Even retirees who own their own homes will feel the pinch of higher utility bills and transportation fees.</p> <h2>7. Chicago, IL</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/chicago.jpg" /></p> <p>Illinois as a whole gets a low approval rating from its own residents, with one in four saying <a href="http://www.gallup.com/poll/168653/montanans-alaskans-say-states-among-top-places-live.aspx">the state is the worst place to live</a>. Why? It could possibly be because of the high income tax hikes and lower bond rates, both signs of a troubled economy. Add in the fact that many Chicago residents have decided to leave the city altogether, making Chi-town the <a href="http://www.forbes.com/pictures/mli45lmhg/4-chicago-ill/">6th most-abandoned large city</a> in the U.S. and it's a less appealing option to live out the rest of your years.</p> <h2>8. Philadelphia, PA</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/philadelphia.jpg" /></p> <p>While it's not as expensive to live in as New York City, there are some issues that may keep the 65 and older crowd away from the city of brotherly love. A higher-than-average sales tax and poor air quality may be of concern to retirees. Throw in the <a href="http://os.cqpress.com/citycrime/2013/2014_CityCrimeRankingsbyPopulation.pdf">high rate of crime</a> (it ranks 5th nationwide), and you have a few good reasons to shop around for your retirement abode.</p> <h2>9. Washington, D.C.</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/washington%20dc.jpg" /></p> <p>In addition to brutally cold winters, economics continues to be a problem for our nation's capital, with the numbers of those under the <a href="http://www.dcfpi.org/poverty-rates-remain-high-for-some-groups-of-dc-residents">poverty line increasing</a> &mdash; despite a rise in median income. With seniors living on a fixed income, the high cost of real estate can also cause concern.</p> <h2>10. Providence, RI</h2> <p><img width="605" height="340" alt="" src="http://www.wisebread.com/files/fruganomics/u5123/providence.jpg" /></p> <p>Across numerous rating scales out there, Providence almost always appears at the top of the worst lists. This is due to a high cost of living, high tax rates, and one of the highest unemployment rates in the nation (currently at a rate of 10% for the city and <a href="http://www.providencejournal.com/business/content/20141124-r.i.-unemployment-rate-again-3rd-worst-in-nation.ece">3rd highest</a> for the entire state.) If you are hoping to supplement your income or kill some boredom during your retired years, finding a part-time job in Providence may be impossible.</p> <p><em>Where are you planning to retire?</em></p> <a href="http://www.wisebread.com/dont-choose-these-10-cities-if-you-want-to-retire-comfortably" class="sharethis-link" title="Don&#039;t Choose These 10 Cities If You Want to Retire Comfortably" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/linsey-knerl">Linsey Knerl</a> of <a href="http://www.wisebread.com/dont-choose-these-10-cities-if-you-want-to-retire-comfortably">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/book-review-work-less-live-more">Book review: Work Less, Live More</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/x-exciting-world-cities-you-can-afford-to-retire-in">4 Exciting World Cities You Can Afford to Retire In</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-five-types-of-people-who-never-retire-are-you-one-of-them">The Five Types of People Who Never Retire (Are You One of Them?)</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/retirement-on-the-installment-plan">Retirement on the installment plan</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/book-review-cash-rich-retirement">Book review: Cash-Rich Retirement</a></span> </div> </li> </ul> </div> </div> </div> </div> Career and Income Retirement cost of living places to retire retire retirement cities where to live Thu, 04 Dec 2014 11:00:07 +0000 Linsey Knerl 1263679 at http://www.wisebread.com The Five Types of People Who Never Retire (Are You One of Them?) http://www.wisebread.com/the-five-types-of-people-who-never-retire-are-you-one-of-them <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-five-types-of-people-who-never-retire-are-you-one-of-them" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/man-busy-office-166114539-small.jpg" alt="man busy office" title="man busy office" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p style="margin-left: 40px;">&quot;I actually think the whole concept of retirement is a bit stupid, so yes, I do want to do something else. There is this strange thing that just because chronologically on a Friday night you have reached a certain age&hellip; with all that experience, how can it be that on a Monday morning, you are useless?&quot; &mdash; Stuart Rose</p> <p>What springs to mind when you think about retirement? I wistfully think about sleeping in, and not using a time clock (which I despise). But for other people, the word &quot;retirement&quot; causes shudders. (See also: <a href="http://www.wisebread.com/will-you-ever-be-able-to-retire?ref=seealso">Will You Ever Be Able to Retire?</a>)</p> <p>Consider these five categories of people who will never retire. Are you among them?</p> <h2>1. The Broke Non-Retiree</h2> <p>Personally, I find this the most unsettling scenario. Whether due to poor financial planning or heavier-than-anticipated financial needs, more and more older workers continue to find themselves in the labor pool. According to the Center for Public Affairs Research, a 2013 survey revealed that a startling 47% now <a href="http://www.apnorc.org/PDFs/Working%20Longer/NORC-AP-NORC-Working-longer.pdf">plan to retire at a later age</a> than they expected when they were 40. The survey also found that 39% of workers age 50 and older report having $100,000 or less saved for retirement, not including pensions or homes; 24% have less than 10,000.</p> <p>Maybe it's time to take stock of your financial future by <a href="http://moneyover55.about.com/od/preretirementplanning/a/estimate_expenses_in_retirement.htm">estimating your retirement expenses</a>.</p> <h2>2. The Workaholic</h2> <p>There is a difference between the person who enjoys work, and does so with enthusiasm, and the person whose life is out of balance and cannot stop working. Perhaps you have run across some of these in your work, too. As the Wall Street Journal explains, workaholics have<a href="http://online.wsj.com/articles/for-some-retirement-brings-grief-1414886644?mod=e2tw"> difficulty transitioning from work to retirement life</a>, because so much of their identity, social network, and purpose is tied to their career. They can feel adrift in retirement without the structure work provides.</p> <p>When working is almost an addiction, it can be devastating to face retirement. One of my former co-workers springs to mind. Although qualified to retire for years, she fought it tooth and nail, taking work home and working weekends. Even when finally convinced by management that it was time for her to step down, she would find excuses to drop by the office, or call people to have lunch. If you recognize yourself in this description, there is help available. Consider support groups, such as <a href="http://www.workaholics-anonymous.org/page.php?page=home">Workaholics Anonymous</a>, which aim to help workaholics develop coping skills and the ability to relax during downtime.</p> <h2>3. The Successful Investor</h2> <p>You may know some people in this category. They bought rentals, years ago, and now are landlords. Or perhaps they bought silver or gold, or learned how to effectively invest in the stock market. There is a common thread here: They got moving, educated themselves, and by their 50s, were enjoying a leisurely lifestyle. But that doesn't mean they want to (or can) stop. Many keep at it, repairing their rentals, or checking their investments every day. They've made being a successful investor their life's work, and they have no need to &quot;retire&quot; from it.</p> <h2>4. The Life Re-Inventor</h2> <p>Starting a new career later in life can be an invigorating way to re-invent yourself. My friend Nancy, a former school art teacher, began working with the mentally ill, eventually started teaching classes, and is now co-authoring a book about art therapy. She finds it tremendously rewarding and has learned a lot of new things. Her husband, an engineer, always wanted to be a teacher, so he started volunteering at a school. He was so successful at tutoring, he was shortly offered a paying position.</p> <p>For my friends, the career switch was fairly easy. However, you certainly wouldn't want to quit your present job and jump into something new without doing some research and soul-searching. Will your new career help fulfill life ambitions? Will it offer a large enough paycheck to make the switch and time investment worthwhile? (See also: <a href="http://www.wisebread.com/6-ways-to-avoid-running-out-of-money-in-retirement?ref=seealso">6 Ways to Avoid Running Out of Money in Retirement</a>)</p> <h2>5. The Mega-Successful Lifers</h2> <p>Consider the lives of the truly, astoundingly successful. For a mega-successful CEO or famous actor, the demand for their talents are so high, that there's less incentive to quit working. According to a study by Merrill Lynch and Age Wave, the <a href="http://nbr.com/2014/07/22/millionaires-never-retire/">desire to keep working</a> until the last day is common to over 60% of the wealthy. But you don't have to be filthy rich or famous for this to be true of you, too. Evidence also suggests that many people who are successful in more realistic endeavors &mdash; such as artists, small business owners or physicians &mdash; also feel the incentive to continue using their talents until the very last day. Will you?</p> <p><em>What are your retirement plans? Do you see yourself in one of these categories? Please share in comments!</em></p> <a href="http://www.wisebread.com/the-five-types-of-people-who-never-retire-are-you-one-of-them" class="sharethis-link" title="The Five Types of People Who Never Retire (Are You One of Them?)" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/marla-walters">Marla Walters</a> of <a href="http://www.wisebread.com/the-five-types-of-people-who-never-retire-are-you-one-of-them">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/book-review-cash-rich-retirement">Book review: Cash-Rich Retirement</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/book-review-retire-on-less-than-you-think">Book review: Retire on Less Than You Think</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-choose-these-10-cities-if-you-want-to-retire-comfortably">Don&#039;t Choose These 10 Cities If You Want to Retire Comfortably</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-thoughts-everyone-has-their-first-day-of-retirement">6 Thoughts Everyone Has Their First Day of Retirement</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/boost-your-retirement-savings-avoid-401k-fees">Boost Your Retirement Savings: Avoid 401(k) Fees</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement retire retirement planning Wed, 26 Nov 2014 16:30:17 +0000 Marla Walters 1260444 at http://www.wisebread.com Best Money Tips: Common Retirement Planning Mistakes http://www.wisebread.com/best-money-tips-common-retirement-planning-mistakes <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-common-retirement-planning-mistakes" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/couple-reviewing-bills-77744657-small_0.jpg" alt="couple reviewing bills" title="couple reviewing bills" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Welcome to Wise Bread's <a href="http://www.wisebread.com/topic/best-money-tips">Best Money Tips</a> Roundup! Today we found some very cool articles on common retirement planning mistakes, amazing ways to use balloons, and stocking your medicine cabinet for less.</p> <h2>Top 5 Articles</h2> <p><a href="http://couplemoney.com/retirement/what-are-the-most-common-mistakes-people-make-when-planning-for-retirement">What Are the Most Common Mistakes People Make When Planning for Retirement?</a> &mdash; Don't wait until you have more money to invest; time is one of your biggest allies when it comes to retirement planning, so start as soon as possible! [Couple Money]</p> <p><a href="http://www.popsugar.com/smart-living/Uses-Balloons-31135985">23 Amazing Ways to Use Balloons</a> &mdash; You can use balloons make chocolate cups for all sorts of yummy treats! [PopSugar Smart Living]</p> <p><a href="http://www.getrichslowly.org/blog/2014/11/10/cold-and-flu-season-stock-your-medicine-cabinet-for-less/">Cold and Flu Season: Stock Your Medicine Cabinet for Less</a> &mdash; Buying generic medications can save you up to 50% or more. [Get Rich Slowly]</p> <p><a href="http://www.creditsesame.com/blog/how-to-dispute-a-credit-card-charge/">Know Your Rights: How to Dispute a Credit Card Charge</a> &mdash; Contact the merchant first. Most businesses will happily correct a mistake. [Credit Sesame]</p> <p><a href="http://couponpal.com/blog/7-ugly-christmas-sweater-party-ideas-for-the-tackiest-party-ever">7 Ugly Christmas Sweater Party Ideas for the Tackiest Party Ever</a> &mdash; The focus of any Ugly Christmas Sweater Party will obviously be the sweaters. To ensure you have the best (or worst), start with a mildly ugly sweater, then add strategically-placed DIY embellishments. [CouponPal]</p> <h2>Other Essential Reading</h2> <p><a href="http://ptmoney.com/financial-worries-for-millenials/">3 Financial Worries That Didn't Exist for Your Parents</a> &mdash; The sophistication of data mining is fairly new. Having access to your search information allows companies to tailor their marketing to what you're looking for, making it harder and harder to resist their tactics. [PT Money]</p> <p><a href="http://www.freemoneywisdom.com/5-smart-internet-businesses-to-start-under-50/">5 Smart Internet Businesses to Start for Under $50</a> &mdash; Are you crafty or artistic? You can make some extra money by creating custom gifts for birthdays, anniversaries, holidays, and more! [Free Wisdom]</p> <p><a href="http://www.dontpayfull.com/blog/top-10-painless-ways-to-save-money-without-changing-your-lifestyle">Top 10 Painless Ways to Save Money Without Changing Your Lifestyle!</a> &mdash; Many companies will offer a discount when you sign up for their bundled packages. [Don't Pay Full]</p> <p><a href="http://parentingsquad.com/how-to-not-spoil-your-kids-this-christmas">How to Not Spoil Your Kids This Christmas</a> &mdash; Set a limit on the number of gifts each child receives &mdash; or how much you spend on them &mdash; and stick to it! [Parenting Squad]</p> <p><a href="http://moneysmartlife.com/improve-credit-score/">How to Improve Your Credit Score by Focusing on Payment History and Reducing Credit Card Debt</a> &mdash; Your payment history is a big part of most credit scoring models. If you're serious about improving your credit score, then you need to start making your payments on time. [Money Smart Life]</p> <a href="http://www.wisebread.com/best-money-tips-common-retirement-planning-mistakes" class="sharethis-link" title="Best Money Tips: Common Retirement Planning Mistakes" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/amy-lu">Amy Lu</a> of <a href="http://www.wisebread.com/best-money-tips-common-retirement-planning-mistakes">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-9"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon">5 Reasons to Fire Your Financial Adviser Soon</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-taking-social-security-could-cost-you-thousands">Why Taking Social Security Could Cost You Thousands</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-changes-that-will-affect-your-money-in-2015-0">9 Changes That Will Affect Your Money in 2015</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-calculate-future-value-and-why-it-matters">How to Calculate Future Value, and Why It Matters</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-choose-these-10-cities-if-you-want-to-retire-comfortably">Don&#039;t Choose These 10 Cities If You Want to Retire Comfortably</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement best money tips financial mistakes Wed, 12 Nov 2014 20:00:10 +0000 Amy Lu 1253955 at http://www.wisebread.com 7 Occasions When You Should Definitely Hire a Financial Advisor http://www.wisebread.com/7-occasions-when-you-should-definitely-hire-a-financial-advisor <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-occasions-when-you-should-definitely-hire-a-financial-advisor" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/financial-advisor-153824915-small.jpg" alt="financial advisor" title="financial advisor" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Laying out a few hundred dollars for a financial advisor can seem like money down the drain if everything is going smoothly. (See also: <a href="http://www.wisebread.com/9-signs-you-need-to-fire-your-financial-planner?ref=seealso">9 Signs You Need to Fire Your Financial Planner</a>)</p> <p>Until it isn't. Life's road bumps pop up, and good and bad things that happen can lead to financial problems or opportunities that you weren't prepared for. Here are seven occasions when a financial advisor should be called in to help.</p> <h2>1. Ruinous Debt</h2> <p>We're not talking about having payments for a credit card lapse for a month, but deep debt where you're having difficulty deciding which bills to pay and which to put off each month. This is a case where you don't want to have to pay a financial advisor &mdash; whether it's a one-time fee or percentage of assets that they manage. Instead, go somewhere such as the <a href="https://www.nfcc.org/index.php">National Foundation for Credit Counseling</a> or look for <a href="http://www.usa.gov/topics/money/credit/debt/out-of-control.shtml">local nonprofit agencies for free help</a>. At the very least, get help setting up a budget.</p> <h2>2. Career Change</h2> <p>Hopefully, this is an opportunity to earn more money and therefore put more money aside in a retirement account. A financial advisor can help you pick a retirement account that's right for you.</p> <p>Young people with the potential for increasing their assets who are starting their careers should seek a financial planner, says Eric Roberge, a fee-only certified financial planner in Boston and founder of <a href="http://beyondyourhammock.com/">Beyond Your Hammock</a>. This is especially true for a single person earning at least $75,000 a year or a couple earning $150,000 because they should have more money to invest, Roberge says.</p> <h2>3. Sudden Wealth</h2> <p>An inheritance, insurance payout, lump-sum pension payment, divorce settlement, lottery winning, or any other sudden influx of new money can burn a hole in a pocket, says Mike Sena, a certified financial planner at <a href="http://www.whitestreetadvisors.com/">White Street Advisors</a> in Roswell, GA. It can be tempting to splurge a little &mdash; or a lot. Instead, seek advice on how best to use your windfall now &mdash; and for years to come.</p> <h2>4. Death in the Family</h2> <p>The death of a close relative can be a key time to get financial help. You could face tax implications or need help with estate planning, for example.</p> <p>Roberge had a client who didn't seek his advice after her father died with a $600,000 annuity she inherited, and she took some money out of the annuity. She ended up having to pay a $40,000 tax bill, which Roberge says he could have helped her avoid.</p> <h2>5. Passing on a Family Business</h2> <p>Your parents and grandparents may want you to continue running the family business when they die, but you may not. This is a conversation that a financial advisor can help with early, says <a href="http://charleskochel.com/">Charles Kochel</a>, a wealth advisor for a fee-only Registered Investment Advisor in Arkansas. Kochel specializes in helping farmers transfer the family farm from one generation to the next.</p> <p>&quot;A major concern of a large family farm is legacy planning,&quot; he says. &quot;The issue is usually lack of communication. Multigenerational farmers assume the next generation will want to come back home, after college, and manage the farm or the assumption is that farming may prove too costly.</p> <p>&quot;A series of conversations needs to take place, often emotional and uncomfortable,&quot; Kochel says. &quot;A family meeting and ongoing proactive conversations help monitor the wants and needs of the entire legacy.&quot;</p> <p>The family will likely evolve over the years, and a financial advisor can help systemize the process and create an ongoing conversation that will move the estate planning beyond a one-time event.</p> <h2>6. Big Drop in the Stock Market</h2> <p>If your portfolio includes stocks, a financial advisor can help you come up with a financial plan, and stick to it.</p> <p>&quot;Most people think they can handle their own investments, but when the stock market drops, they start second-guessing their plan,&quot; says Tyler Gray, a financial planner at <a href="http://www.sageoakfinancial.com/">Sage Oak Financial</a> in Tulsa, OK.</p> <p>In 2008-09, for example, &quot;you had a lot of people who pulled out of the market at the worst possible time because they didn't have an advisor to help them stay disciplined,&quot; Gray says. &quot;The worst part is that many of these folks never got back in the market and have missed out on a lot of growth over the last five years.&quot;</p> <h2>7. Growing Family</h2> <p>Whether you're getting married or having children, it's best to have a financial conversation ahead of time, Sena suggests. New couples merging finances or planning for a baby and all of the costs that go into raising a child should have a financial plan.</p> <p>&quot;In general, anyone who is not meeting or exceeding their life and financial goals should work with an advisor,&quot; White says. &quot;Most of us are simply too close to our money to be objective.&quot;</p> <p>For better or worse, major life events can cause people to rethink their lives and plan for the future. Planning for a financial future should be part of many major events in life.</p> <p><em>Have you ever sought advice from a financial planner? What prompted you? Was the advice worthwhile and helpful? Please share in comments!</em></p> <a href="http://www.wisebread.com/7-occasions-when-you-should-definitely-hire-a-financial-advisor" class="sharethis-link" title="7 Occasions When You Should Definitely Hire a Financial Advisor" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/aaron-crowe">Aaron Crowe</a> of <a href="http://www.wisebread.com/7-occasions-when-you-should-definitely-hire-a-financial-advisor">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-10"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/intimidated-by-retirement-investing-get-professional-help">Intimidated by Retirement Investing? Get Professional Help!</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon">5 Reasons to Fire Your Financial Adviser Soon</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-this-hidden-cost-sapping-your-retirement-savings">Is This Hidden Cost Sapping Your Retirement Savings?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-inspiring-people-who-each-paid-off-over-100000-in-debt">5 Inspiring People Who Each Paid Off Over $100,000 in Debt</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-dumb-investments-smart-people-make">5 Dumb Investments Smart People Make</a></span> </div> </li> </ul> </div> </div> </div> </div> Debt Management Investment Retirement debt financial planner financial planning investing retirement Mon, 03 Nov 2014 13:00:04 +0000 Aaron Crowe 1248279 at http://www.wisebread.com 7 Ways to Keep Your Retirement Funds From Disappearing http://www.wisebread.com/7-ways-to-keep-your-retirement-funds-from-disappearing <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-ways-to-keep-your-retirement-funds-from-disappearing" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/mature-couple-finances-488124131-small.jpg" alt="mature couple finances" title="mature couple finances" class="imagecache imagecache-250w" width="250" height="124" /></a> </div> </div> </div> <p>More than one-third of Americans have <a href="http://www.cbsnews.com/news/shocking-number-of-americans-have-no-retirement-savings/">no retirement savings</a>.</p> <p>This shocking figure should provide a wake up call and set you on your course to better prepare for retirement. Even if you haven't started yet, it's never too late. (See also: <a href="http://www.wisebread.com/this-is-the-basic-intro-to-having-a-retirement-fund-that-everyone-needs-to-read?ref=seealso">This Is the Basic Intro to Having a Retirement Fund That Everyone Needs to Read</a>).</p> <p>No matter the size of your retirement account, here are seven effective strategies to help you keep your retirement account from disappearing.</p> <h2>1. Borrow as Little as Possible From a Retirement Fund</h2> <p>Sometimes finding good financing options can be difficult. That's when you may start eyeing your 401(k) for a loan. While you may think that it is easy to pay those funds back, statistics show that's not the case. Every year Americans default on about <a href="http://money.cnn.com/2012/07/17/retirement/401k-loan-defaults/">$37 billion in 401(k) loans</a>.</p> <p>If you are unable to pay back your 401(k) loan within five years, you're hit with a double whammy:</p> <ul> <li>The unpaid balance becomes an early withdrawal from your 401(k), receives a 10% early distribution tax penalty from the IRS, and becomes taxable income as well.<br /> &nbsp;</li> <li>You cannot make up for those contributions to your retirement account. Every year you have a contribution limit, and if you don't use it, you lose it!</li> </ul> <p>There are very, very few instances in which you should borrow from your retirement fund. One of those few instances is when you need a down payment for a home purchase. (See also: <a href="http://www.wisebread.com/this-is-when-you-should-borrow-from-your-retirement-account?ref=seealso">This Is When You Should Borrow From Your Retirement Account</a>)</p> <h2>2. Set Up an Emergency Fund</h2> <p>26% of Americans have <a href="http://blogs.wsj.com/numbers/one-in-four-americans-has-no-emergency-savings-1467/">no emergency savings</a>.</p> <p>This is a major reason retirement disappears. You need to plan ahead and have enough saved up to cover your income for at least six months. In 2014, only 40% of Americans are able to save enough to cover at least three months. Don't become part of that statistic and start saving today towards a rainy day.</p> <p>Having an emergency fund does away with the need to tap your retirement accounts. Your nest egg should be your very last resort for money before retirement. However, don't just stop with maintaining an emergency fund: Create a detailed plan of action for when disaster strikes. (See also: <a href="http://www.wisebread.com/emergency-plan-better-than-an-emergency-fund?ref=seealso">Emergency Plan: Better Than an Emergency Fund</a>)</p> <h2>3. Avoid Early Withdrawal Penalties</h2> <p>In 2010, penalized 401(k) withdrawals hit a <a href="http://business.time.com/2013/01/23/cash-leaking-out-of-401k-plans-at-alarming-rate/">record high of almost $60 billion</a>. Taking early withdrawals (also known as distributions) puts a heavy toll on your nest egg. Not only are you responsible for the applicable income taxes, but also you have to pay the 10% additional early distribution tax.</p> <p>Fortunately, the IRS does provide some <a href="http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics&mdash;-Tax-on-Early-Distributions">exceptions to the 10% additional tax on early distributions</a>. For example, you can withdraw early without penalty:</p> <ul> <li>From eligible IRA, SEP, Simple IRA, and SARSEP plans for qualifying higher education expenses for your spouse or immediate family members;<br /> &nbsp;</li> <li>From eligible retirement plans, including 401(k) plans, for unreimbursed medical expenses exceeding 10% of your income; and<br /> &nbsp;</li> <li>Up to $10,000 from eligible traditional IRA plans for <a href="http://money.usnews.com/money/blogs/my-money/2013/10/28/using-your-ira-for-a-downpayment">first-time home purchases or substantial home improvements</a>.</li> </ul> <p>While there exceptions to the 10% additional tax, there are no exceptions to applicable income taxes, including capital gains. Consult your financial advisor before attempting any early withdrawals from your retirement accounts.</p> <h2>4. Minimize Management Fees</h2> <p>Talking about retirement plan managers, you need to check how much you are paying in plan management fees. According to an <a href="http://assets.aarp.org/rgcenter/econ/401k-fees-awareness-11.pdf">AARP study on 401(k) participants</a>, about three in five Americans are unaware of how much they are paying in fees for their retirement accounts, and almost one in three is unsure of the impact of fees in their retirement savings.</p> <p>A good rule of thumb is that your total expense ratio should be no more than 1%. For example, if you have $30,000 in retirement savings, your total management expense should be no more than $300. If you're getting charged more than that, it is time to dump that plan and look for more reasonable alternatives.</p> <p>If you have several retirement accounts from previous employers, evaluate if it makes sense to roll over all those balances into your retirement account with the smallest management fees. Before initiating the rollover, review all applicable fees and eligibility rules.</p> <h2>5. Stop Playing the Market</h2> <p>When you hear about &quot;a hot stock tip,&quot; you should walk away. Like Benjamin Franklin said, the only sure things in life are death and taxes. Nearly half of 401(k) plan owners don't know what their <a href="http://money.msn.com/investing/why-workers-are-botching-their-401k-investments">best investment options</a> are.</p> <p>There are several problems with playing the market on your own.</p> <ul> <li>Most retirement plans charge fees for every transaction that you make. Remember that you want to <em>minimize </em>fees.<br /> &nbsp;</li> <li>Trying to juggle your day job and the stock market may cause a lot of unneeded stress.<br /> &nbsp;</li> <li>The average actively managed mutual fund returns <a href="http://www.fool.com/School/MutualFunds/Performance/Record.htm">approximately 2% less per year than the stock market</a>. And these are the pros that do it for a living!</li> </ul> <p>Keep in mind at all times that getting to your retirement goal isn't a sprint; it's a marathon.</p> <h2>6. Participate in Employer-Sponsored Plans</h2> <p>If you have the option of signing up for an employer-sponsored retirement program, do it. Nine in 10 Americans participating in <a href="http://www.ebri.org/publications/ib/index.cfm?fa=ibDisp&amp;content_id=5362">employer-sponsored retirement plans</a> actually save for retirement. Trying to save on your own is much harder and requires a lot of self-discipline. This is why only two in 10 Americans are able to have a nest egg without an employer-sponsored plan.</p> <p>There are two additional benefits to participating in employer-sponsored plans. First, some of them match your contributions. The <a href="http://www.americanbenefitscouncil.org/documents2013/401k_stats.pdf">average employer match is 4.5% of pay</a> to a retirement account. Don't leave free money on the table. Second, <a href="http://www.shrm.org/research/surveyfindings/articles/documents/13-0245%202013_empbenefits_fnl.pdf">more than half of companies offer some type of investment advice</a>. This is valuable and free information to make more informed decisions about your retirement strategy.</p> <h2>7. Consider Annuities</h2> <p>Why?</p> <ul> <li>Some types of annuities guarantee a steady stream of income.<br /> &nbsp;</li> <li>Like retirement plans, annuities allow you to defer taxes until retirement.<br /> &nbsp;</li> <li>Unlike retirement plans, annuities have no contribution limits.<br /> &nbsp;</li> <li>Some annuities offer upside income potential, while guaranteeing your original investment or a minimum return on your investment to your beneficiaries in case of your death.<br /> &nbsp;</li> <li>Annuities allow older individuals to make additional catchup contributions.</li> </ul> <p>There are different types of annuities, so make sure to review and understand the applicable rules, such as required initial investments and applicable fees. Talk with your financial advisor about whether or not annuities make sense with your retirement planning strategy. (See also: <a href="http://www.wisebread.com/dont-know-what-annuities-are-you-might-be-missing-out?ref=seealso">Don't Know What Annuities Are? You Might Be Missing Out</a>)</p> <p><em>What are other useful strategies to avoid a disappearing retirement? Please share in comments below!</em></p> <a href="http://www.wisebread.com/7-ways-to-keep-your-retirement-funds-from-disappearing" class="sharethis-link" title="7 Ways to Keep Your Retirement Funds From Disappearing" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/7-ways-to-keep-your-retirement-funds-from-disappearing">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-11"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-ways-to-boost-your-401k-returns">4 Ways to Boost Your 401(k) Returns</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/choosing-a-retirement-account-whats-available-and-what-s-best-for-you">Choosing a Retirement Account: What&#039;s Available, and What’s Best for You?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-is-why-you-cant-postpone-planning-for-your-retirement-and-how-to-start">This Is Why You Can&#039;t Postpone Planning for Your Retirement (And How to Start)</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-one-thing-will-get-you-to-1-million-tax-free">This One Thing Will Get You to $1 Million (Tax-Free!)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/book-review-cash-rich-retirement">Book review: Cash-Rich Retirement</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement 401(k) annuity investing retirement planning Mon, 20 Oct 2014 13:00:06 +0000 Damian Davila 1237800 at http://www.wisebread.com 6 Thoughts Everyone Has Their First Day of Retirement http://www.wisebread.com/6-thoughts-everyone-has-their-first-day-of-retirement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-thoughts-everyone-has-their-first-day-of-retirement" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/retirement-thinking-177547670-small.jpg" alt="man thinking" title="man thinking" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It's a major milestone in anyone's life: retirement. You spend so many hours dreaming about just what you'll do with the time, that when it happens, you often aren't prepared for the reality of it. Retirement isn't always the answer to the unfulfilled life that many expect it to be, however, and some even struggle with the new way of life. (See also: <a href="http://www.wisebread.com/12-things-you-didnt-know-about-retirement?ref=seealso">12 Things You Don't Know About Retirement</a>)</p> <p>Getting a handle on the new feelings can take time. Here are a few of the initial reactions to the new season, along with some tips for keeping everything in perspective.</p> <h2>1. What Will I Do With All the Time?</h2> <p>Going from a full-time career to no job at all can be a jarring experience, one that can even feel like a loss to some. In addition, &quot;Many new retirees are concerned about how they will fill up their new found free time after retiring,&quot; says Hank Coleman, publisher of the popular site, <a href="http://moneyqanda.com/">Money Q&amp;A</a>. &quot;It can be beneficial for new retirees to take retirement for a test drive. You may want to consider a mini-retirement for a few months before you take the plunge full-time. Maybe you have a hobby or a side business that you want to pursue. Use some of your vacation days before retiring to try out what you'll be doing when you finally cut the work cord for good.&quot;</p> <h2>2. How Can I Stay On Track With My Nest Egg?</h2> <p>Outliving your retirement savings is a legitimate concern for many, and it's one that shouldn't be overlooked. Even if you've done the math and are confident that you can make your savings last, it's best to continue using a budget and assess your progress at least every six months. Check in with your accounts at the end of each year, and see how tax changes, new Medicare laws, or other legislation could positively or negatively affect your monthly living expenses. Make adjustments as needed.</p> <h2>3. Should I Stay or Should I Go?</h2> <p>If your retirement plans included getting away, or possibly even moving, it may be tempting to do so right away. Like any expensive or life-changing decision, however, it's always good to go into it informed. And while plenty of websites are always stating their opinions on the top locations to retire, the logistics of uprooting your home in your retirement years can be stressful. Things to consider &mdash; in addition to cost of living or climate &mdash; should include proximity to the family that may care for you in your older years. (See also: <a href="http://www.wisebread.com/5-incredible-places-to-retire-abroad-that-anyone-can-afford?ref=seealso">5 Incredible Places to Retire Abroad That Anyone Can Afford</a>)</p> <h2>4. Who Am I Now?</h2> <p>If you took pride in your career, or simply identified with your occupation for so long that you don't have a world outside of it, it may be tempting to consider yourself as &quot;just a retiree.&quot; It's not necessary to consider yourself so closely tied to your profession &mdash; or lack of. Start to take inventory of your gifts, skills, and character traits outside of your 9-to-5; you may be surprised to find that you can have an identity built on the kind of person you are, despite having just considered yourself the sum of our working years.</p> <h2>5. How Will This Affect My Relationships?</h2> <p>&quot;When a man retires, his wife gets twice the husband but only half the income.&quot; &mdash; Chi Chi Rodriguez&quot;</p> <p>This vintage joke never gets old, and it couldn't be truer. One of the toughest adjustments to retirement happens when couples find they instantly have more hours in their day to spend together. For the entrepreneur or couple who works with their significant other already, it's not as dramatic as the office worker who now gets to see their partner for an additional 50 or 60 hours a week. Don't feel that you have to spend it all together, however; many couples find that having separate hobbies well into their retirement is the key to a happy rest of their lives together.</p> <h2>6. Is This It?</h2> <p>Retirement should be celebrated, but for many, it also gets them thinking about death. The final years of life &mdash; whether they be just a few, or more than 30 &mdash; can be met with anxiety and uncertainty. (See also: <a href="http://www.wisebread.com/dont-let-poor-health-kill-your-retirement-fund?ref=seealso">Don't Let Poor Health Kill Your Retirement Fund</a>)</p> <p>One way to combat the tensions and worry that some new retirees face is to made a proactive plan toward preventative health care and finding hobbies that can prolong life. Activities around exercise, healthy foods, or relieving stress can be enjoyable well into old age, and they are just the sort of things that can help make the later years vibrant, too. Look for other retirees to share these experiences with; signing up for a seniors cooking class, for example, can give life skills for meeting upcoming health challenges and can introduce you to new faces to spend those work-free days with.</p> <p><em>Are you retired? What did you think on your first days of retirement?</em></p> <a href="http://www.wisebread.com/6-thoughts-everyone-has-their-first-day-of-retirement" class="sharethis-link" title="6 Thoughts Everyone Has Their First Day of Retirement" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/linsey-knerl">Linsey Knerl</a> of <a href="http://www.wisebread.com/6-thoughts-everyone-has-their-first-day-of-retirement">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-12"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-five-types-of-people-who-never-retire-are-you-one-of-them">The Five Types of People Who Never Retire (Are You One of Them?)</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/boost-your-retirement-savings-avoid-401k-fees">Boost Your Retirement Savings: Avoid 401(k) Fees</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-to-avoid-running-out-of-money-in-retirement">6 Ways to Avoid Running Out of Money in Retirement</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/canada-and-us-retirement-showdown-which-offers-more-for-retirees">Canada and U.S. Retirement Showdown: Which Offers More for Retirees?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/choosing-a-retirement-account-whats-available-and-what-s-best-for-you">Choosing a Retirement Account: What&#039;s Available, and What’s Best for You?</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement retirement planning retiring where to retire Wed, 08 Oct 2014 13:00:04 +0000 Linsey Knerl 1227988 at http://www.wisebread.com Best Money Tips: Top 10 Retirement Planning Mistakes http://www.wisebread.com/best-money-tips-top-10-retirement-planning-mistakes <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-top-10-retirement-planning-mistakes" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/retirement-planning-stress-176759357-small.jpg" alt="retirement planning stress" title="retirement planning stress" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Welcome to Wise Bread's <a href="http://www.wisebread.com/topic/best-money-tips">Best Money Tips</a> Roundup! Today we found some stellar articles on retirement planning mistakes, money rules that nobody will ever teach you, and budgeting on a variable income.</p> <h2>Top 5 Articles</h2> <p><a href="http://christianpf.com/retirement-planning-mistakes/">Top 10 Retirement Planning Mistakes &mdash; Are You Making Any of Them?</a> &mdash; Are you making the retirement planning mistake of not saving enough? What about waiting too long to start saving? [Christian PF]</p> <p><a href="http://studenomics.com/personal-finance/secret-money-rules/">The Secret Money Rules That Nobody Will Ever Teach You</a> &mdash; Chances are, no one will teach you that you should always live within your means. [Studenomics]</p> <p><a href="http://kylieofiu.com/2014/09/budgeting-on-a-variable-income/">Budgeting on a Variable Income</a> &mdash; It is vital to gather all your bills and track your spending when you budget on a variable income. [Kylie Ofiu]</p> <p><a href="http://www.mightybargainhunter.com/one-person-responsible-financial-decisions/">The One Person Responsible for Your Financial Decisions</a> &mdash; Remember that financial advice, no matter how reasonable, is not one size fits all. [Mighty Bargain Hunter]</p> <p><a href="http://citi.us/1p0oTpk">6 Ways to Keep Your Top-Performing Millennials on Board</a> &mdash; Creating opportunities for international travel can help companies keep millennials on board. [Women &amp; Co]</p> <h2>Other Essential Reading</h2> <p><a href="http://www.narrowbridge.net/get-off-the-grid/">How to Get Off the Grid</a> &mdash; To get off the grid, consider trying to grow your own food. [NarrowBridge Finance]</p> <p><a href="http://dontmesswithtaxes.typepad.com/dont_mess_with_taxes/2014/09/old-age-toll-physical-emotional-financial.html">Getting Old Sucks. We Can't Stop Father Time, But We Can Prepare Physically, Emotionally and Financially</a> &mdash; Are you taking advantage of how the tax code can help you in retirement? [Don't Mess With Taxes]</p> <p><a href="http://sweatingthebigstuff.com/ways-reduce-financial-stress/">4 Ways to Reduce Financial Stress</a> &mdash; If you want to reduce financial stress, create a budget and earn more money. [Sweating the Big Stuff]</p> <p><a href="http://www.popsugar.com/smart-living/Magic-Eraser-Uses-35760193">37 Creative Uses for Your Magic Eraser</a> &mdash; Use your magic eraser to remove stains on dishes and clean the inside of your oven. [PopSugar Smart Living]</p> <p><a href="http://parentingsquad.com/20-mostly-free-ways-to-enjoy-fall-with-your-family">20 Mostly Free Ways to Enjoy Fall With Your Family</a> &mdash; Enjoy fall with your family without breaking the bank by making hot apple cider and visiting a local farm. [Parenting Squad]</p> <a href="http://www.wisebread.com/best-money-tips-top-10-retirement-planning-mistakes" class="sharethis-link" title="Best Money Tips: Top 10 Retirement Planning Mistakes" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-jacobs">Ashley Jacobs</a> of <a href="http://www.wisebread.com/best-money-tips-top-10-retirement-planning-mistakes">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-13"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon">5 Reasons to Fire Your Financial Adviser Soon</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/x-exciting-world-cities-you-can-afford-to-retire-in">4 Exciting World Cities You Can Afford to Retire In</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-balance-saving-for-retirement-emergency-fund-and-paying-off-debt">How to Balance Saving for Retirement, Emergency Fund, and Paying Off Debt</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-is-why-you-cant-postpone-planning-for-your-retirement-and-how-to-start">This Is Why You Can&#039;t Postpone Planning for Your Retirement (And How to Start)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/if-you-want-your-401k-to-grow-stop-doing-these-6-things">If You Want Your 401K to Grow, Stop Doing These 6 Things</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement best money tips Mistakes retirement Wed, 24 Sep 2014 19:00:05 +0000 Ashley Jacobs 1219314 at http://www.wisebread.com Why One-Third of Americans Haven't Saved for Retirement http://www.wisebread.com/why-one-third-of-americans-havent-saved-for-retirement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/why-one-third-of-americans-havent-saved-for-retirement" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/old-man-frustrated-bills-179813059-small.jpg" alt="old man frustrated" title="old man frustrated" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>More than a third of <a href="http://www.bankrate.com/finance/consumer-index/survey-36-percent-not-saving-for-retirement.aspx">Americans haven't started saving for retirement</a>, according to a recent report by Bankrate.com. Interestingly, it's not just young workers who aren't banking their bucks. The survey found that more than a quarter of those aged 50 &ndash; 64 haven't started saving for retirement, either. (See also: <a href="http://www.wisebread.com/10-easy-ways-to-supercharge-your-retirement?ref=seealso">10 Easy Ways to Supercharge Your Retirement</a>)</p> <p>While it's true that the current generation of retirees and pre-retirees are more likely to have a pension plan to cushion their financial burden, the Bankrate.com results point to a staggering conclusion. A large number of Americans &mdash; regardless of age &mdash; are unprepared to take financial responsibility for retirement. So, what's holding us back?</p> <h2>1. We're Living Paycheck to Paycheck</h2> <p>One-third of American households <a href="http://www.brookings.edu/about/projects/bpea/papers/2014/wealthy-hand-to-mouth">live paycheck to paycheck</a>. Of those families, 66% are middle class and have a median income of $41,000.</p> <p>It's difficult to save for retirement when disposable income is limited, but if you manage to do it, most employers offer a match on your 401(k) contributions. An employer match can add a substantial boost to your retirement account balance. (See also: <a href="http://www.wisebread.com/trick-yourself-into-saving-more-of-your-biweekly-paychecks?ref=seealso">Trick Yourself into Saving More of Your Biweekly Paychecks</a>)</p> <h2>2. We Procrastinate</h2> <p>It's tempting to put big decisions off and wait for the next big raise, until the next bill is paid off, or until the kids are through college. The problem, <a href="https://time.com/money/3265108/retirement-savings-crisis-solution/">as defined by one financial journalist</a>, is that savings levels aren't all that different between new workers and those already retired.</p> <p>Putting an end to procrastination can have a monumental effect on your end balance. According to recent research from the Employee Benefit Research Institute, 401(k) participants who consistently contributed to their accounts over the five years ending in 2012<a href="http://www.ebri.org/pdf/PR1089.Longit.31July14.pdf"> saw a healthy 6.8% average annual uptick</a> in their collective balances, even despite a 34.7% drop during the financial crisis of 2008.</p> <p>Further, the earlier you start, the easier it is to build substantial savings. In his analysis of the Bankrate.com poll results, Greg McBride, CFA and Bankrate's chief financial analyst says, &quot;the power of compounding is most evident over long periods of time, and having a longer period of time for your retirement savings to grow and compound makes today's contributions much more impactful.&quot; (See also: <a href="http://www.wisebread.com/this-is-why-you-cant-postpone-planning-for-your-retirement-and-how-to-start?ref=seealso">This is Why You Can't Postpone Planning for Your Retirement</a>)</p> <h2>3. We Don't Have a Retirement Plan at Work</h2> <p>Even if you don't have access to an employer-sponsored retirement savings option, don't let that keep you from having a plan of your own. According to the Employee Benefit Research Institute study noted above, those with a plan are 72% likely to feel very or somewhat confident about their prospects for retirement. Those without a plan, meanwhile, are 69% more likely to feel not at all or not too confident about retirement.</p> <p><a href="http://money.cnn.com/2014/04/01/pf/expert/retirement-savings/">Those without a plan</a> can benefit from several plans such as the traditional IRA, Roth IRA, MyRA, or a traditional brokerage account.</p> <h2>4. We're in Denial</h2> <p>Some workers assume they can maintain their current workload for the remainder of their lives and so choose to forego or limit retirement savings. While later-life retirements are increasing in frequency, the assumption that one can work until death doesn't account for uncontrollable factors like an unexpected job loss or medical issue.</p> <p>Even among those who are saving, many are not saving enough. In <a href="http://www.cnbc.com/id/101480388%23">a recent article</a>, one finance giant CEO tagged the average retirement contribution level at 6% while suggesting that 10% would be better. (See also: <a href="http://www.wisebread.com/6-harmful-money-beliefs-that-are-keeping-you-poor?ref=seealso">6 Harmful Money Beliefs That Are Keeping You Poor</a>)</p> <p>Low or nonexistent contribution levels indicate that many workers aren't taking the time to figure out just <a href="http://www.wisebread.com/how-much-money-will-you-need-to-retire">how much they'll need in retirement</a>. Being aware of your end goal number is the first step to getting financially prepared for retirement &mdash; at every age.</p> <p><em>Are you among the one-third of Americans who haven't saved for retirement?</em></p> <a href="http://www.wisebread.com/why-one-third-of-americans-havent-saved-for-retirement" class="sharethis-link" title="Why One-Third of Americans Haven&#039;t Saved for Retirement" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/alaina-tweddale">Alaina Tweddale</a> of <a href="http://www.wisebread.com/why-one-third-of-americans-havent-saved-for-retirement">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-14"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-is-why-you-cant-postpone-planning-for-your-retirement-and-how-to-start">This Is Why You Can&#039;t Postpone Planning for Your Retirement (And How to Start)</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/you-may-be-putting-your-retirement-money-in-the-wrong-place">You May Be Putting Your Retirement Money in the Wrong Place</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-times-raiding-your-retirement-accounts-early-is-okay">4 Times Raiding Your Retirement Accounts Early Is Okay</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-occasions-when-you-should-definitely-hire-a-financial-advisor">7 Occasions When You Should Definitely Hire a Financial Advisor</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-one-thing-will-get-you-to-1-million-tax-free">This One Thing Will Get You to $1 Million (Tax-Free!)</a></span> </div> </li> </ul> </div> </div> </div> </div> Debt Management Retirement 401(k) retirement saving Tue, 23 Sep 2014 13:00:06 +0000 Alaina Tweddale 1218886 at http://www.wisebread.com 10 Unexpected Things You Should Consider When Picking Where You Retire http://www.wisebread.com/10-unexpected-things-you-should-consider-when-picking-where-you-retire <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-unexpected-things-you-should-consider-when-picking-where-you-retire" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/senior-couple-touring-166160155-small.jpg" alt="senior couple touring" title="senior couple touring" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Retirement often brings about relocation &mdash; possibly to a warmer area, a place with better health care, a quieter community, or just wherever Sal and Judy ended up. What a nice couple!</p> <p>Retirees often focus on things like hospitals, access to national parks, closeness to family, or an established community of senior citizens &mdash; and rightly so. Yet, while these factors will play a major part in the quality of a retiree's life, they aren't the only ones that should be considered.</p> <p>What about other factors that we don't immediately associate with where we're going to retire? Are we being too minimal when we consider the &quot;ideal&quot; location? Perhaps there should be a more comprehensive list of considerations when it comes time to choose the ideal retirement spot. (See also: <a href="http://www.wisebread.com/5-incredible-places-to-retire-abroad-that-anyone-can-afford?ref=seealso">5 Incredible Places to Retire Abroad That Anyone Can Afford</a>)</p> <p>In essence, your retirement location should consider need, but it should also consider preferences and personality. What do you enjoy doing and what kind of atmosphere do you feel the most relaxed in?</p> <p>Here are a few things that if given some forethought, might impact where you decide to settle.</p> <h2>1. Tax Friendliness for Retirees</h2> <p>Tax policies for retirees (and in general) differ from state to state, so if you're on the fence about which part of the country you want to live in, this might be enough to tip you one way or the other. For example, <a href="http://www.kiplinger.com/slideshow/retirement/T006-S001-10-most-tax-friendly-states-for-retirees/">Florida and Alaska</a> have no state income tax, inheritance tax, or estate tax. There are also some helpful exemptions for retirees depending on the state.</p> <h2>2. Airport Proximity</h2> <p>If you plan to do a lot of traveling, consider the proximity of where you live to a larger airport. You can view all of the United State's airport locations on the <a href="http://www.ncdot.gov/travel/airports/">NCDOT website</a>.</p> <h2>3. Access to the Big City</h2> <p>Most retirees prefer to have some separation from big city life. If you do plan to live in a more quiet and rural area, consider how often you might want to visit a bigger city for entertainment, shopping, and just getting out. If you think you'll make that drive frequently, look for the <a href="http://www.wisebread.com/10-of-americas-awesomest-cheap-cities">best rural spots</a> that give you easy driving access to a bigger city.</p> <h2>4. The Restaurant Scene</h2> <p>An active and diverse restaurant scene can really improve your retirement experience, giving you a variety of places to eat and plenty of excuses to have a night out. You'll need to do some local research to find the more unique places. The <a href="https://itunes.apple.com/us/app/restaurant-finder/id324540243?mt=8">Restaurant Finder app</a> will allow you to search areas ahead of time.</p> <h2>5. The &quot;Tourism Factor&quot;</h2> <p>A lot of places that are retiree friendly (take <a href="http://www.thevillages.com/">The Villages</a> in Florida for example) are also active tourist destinations. While some people are attracted to that atmosphere, others prefer to avoid it.</p> <h2>6. Projected Town Growth</h2> <p>Small towns can grow quickly these days as communities that were once little more than a road and woods have become busy streets lined with businesses. If this is something you want to avoid, it can be tough to predict, though targeting more rural areas that are a sizeable distance from bigger cities is a good way to start. You can also do some research on sites like Forbes to get a feel for projected <a href="http://www.forbes.com/sites/joelkotkin/2013/09/04/a-map-of-americas-future-where-growth-will-be-over-the-next-decade/">population growth and development</a> over the next few years.</p> <h2>7. Agriculture</h2> <p>Farmer's markets and access to fresh food are good for your health and offer a small town sense of community. Some places are known for their agricultural prowess, so perhaps they should be on your short list.</p> <h2>8. Traffic</h2> <p>You've spent your entire life dealing with an awful commute, so do you really want it to continue when you retire? The best way to know for sure is by visiting a place during the busy driving times (Friday night, Saturday, holiday weekends), and by simple word of mouth.</p> <h2>9. Weather</h2> <p>With extra time to get out and do some sightseeing you wouldn't want those activities being constantly hampered by extreme temperatures or bad weather. Consider places with more yearly warm weather or a more moderate climate.</p> <h2>10. Availability of Part-Time Work</h2> <p>An increasing number of retirees are opting to continue working in a part time job. This is often to continue in a profession, put in the time, or to supplement retirement savings. Whatever your reasoning, if you plan to work part time it may have a big impact on where you retire.</p> <h2>A Comprehensive Approach</h2> <p>It's important to take your time when you're choosing a retirement location and to be sure you've got a list of considerations that encompasses everything that's going to impact your lifestyle as a retiree; In other words, a comprehensive approach.</p> <p>Family, health and finances are certainly the core issues, but don't dismiss your own preferences and what your day-to-day life is going to look like. Those things will matter, so take the time to get them right.</p> <p><em>Did you retire to a different area? What factors played a role in the decision-making process? If you're currently weighing your options, what factors are you considering? Let me know in the comments below.</em></p> <a href="http://www.wisebread.com/10-unexpected-things-you-should-consider-when-picking-where-you-retire" class="sharethis-link" title="10 Unexpected Things You Should Consider When Picking Where You Retire" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/10-unexpected-things-you-should-consider-when-picking-where-you-retire">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-15"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-tax-moves-you-need-to-make-right-now">6 Tax Moves You Need to Make Right Now</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/if-you-want-your-401k-to-grow-stop-doing-these-6-things">If You Want Your 401K to Grow, Stop Doing These 6 Things</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon">5 Reasons to Fire Your Financial Adviser Soon</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/x-exciting-world-cities-you-can-afford-to-retire-in">4 Exciting World Cities You Can Afford to Retire In</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-balance-saving-for-retirement-emergency-fund-and-paying-off-debt">How to Balance Saving for Retirement, Emergency Fund, and Paying Off Debt</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement city life retirement retirement community taxes Fri, 25 Jul 2014 13:00:02 +0000 Mikey Rox 1167640 at http://www.wisebread.com