Money Tip 6/24/19
Retirees are often concerned about running out of money and if they are withdrawing too much from their accounts. A good rule of thumb is a withdrawal rate of about 4 percent. To calculate, add up the money in all of your retirement accounts and multiply that number by 4%. This is the maximum amount experts say you can use to live on without putting your retirement at risk. Of course everyone’s situation is unique, so you should seek advice from a professional.
Money Tip 6/17/19
Do you know how much is coming out of your paycheck and going into your 401(K) or other retirement plan? If you do not know, it is a good time to find out. Are you contributing a fixed dollar amount, a percentage or the maximum allowed? No matter which method you are using, consider bumping up your contribution. Even a small increase now can have a significant impact on your retirement. Remember to contribute at least the amount that gets you the full match from your employer.
Money Tip 6/10/19
It may be tempting to begin taking Social Security as soon as possible which would normally be at age sixty-two. You may want to delay drawing your Social Security if you can afford it. Each month you wait to draw, you increase your monthly benefit for all subsequent years. By taking early, you may be leaving money on the table that you could have had down the road. Consult a professional who understands Social Security benefits and evaluate your options.
Money Tip 5/27/19
Do you know how much life insurance you have and how much you need? Normally, life insurance is used to replace income that would be lost if someone passes away. Calculating that amount is not easy. It involves multiple factors like your mortgage, children’s education, salary, and age to name a few. We recommend you meet with a professional periodically to review your needs so you know you and your loved ones are adequately covered.
Money Tip 5/20/19
Many employees do not know all the benefits that are available to them at work. You may have access to benefits, such as life insurance, disability, flexible spending accounts and other benefits. You may be taking some unnecessary risks that the benefit could reduce or eliminate and you may be leaving money on the table. Contact your human resources department today and review your available benefits.
Money Tip 5/13/19
When was the last time you reviewed who you named as your beneficiaries? Making sure that you have designated beneficiaries on all your retirement accounts and life insurance policies is a good exercise. Life events such as a birth, a death, a new marriage or a divorce often means its time to update who you have named as beneficiaries. If you haven’t done so in a long time, sit down with your adviser or agent and review your beneficiaries.
Money Tip 5/6/19
If your employer offers you a retirement plan, make sure you are participating. This is an easy, cost effective way for you to save for retirement. Employers usually offer a match, meaning they will put in the same amount or a portion of what you put in, up to a max. If there is an employer match, make sure you are contributing enough to at least get the entire match. Consider it a bonus to your retirement!
Money Tip 4/29/19
If you own your home and have a mortgage, consider paying an extra hundred or two hundred dollars each month. If you can, stick with it. This additional money will reduce your mortgage balance which will shorten the life of your loan. This is another form of saving and can help you reach your goal of retiring debt-free. Let’s face it, you have a lot of fun things you would rather do with your money during retirement other than paying a mortgage.
Money Tip 4/22/19
When making large, discretionary purchases like a new TV, appliance or a car, use the 30-day-rule. This means waiting 30 days to make the purchase unless it is an absolute necessity. This helps eliminate spontaneous purchase decisions. During the 30 days, you should evaluate the pros and cons of making the purchase. This takes an emotional decision and turns it into a rational one. You might even find a lower price or a better use of your money.
Money Tip 4/15/19
At tax time, you’re probably focused on how much you owe or how much you are getting back. However, it’s a good time to see how the new 2018 tax law affected you. To find out if your tax rate went up or down, compare your tax rate and tax bracket to your previous two tax returns. If your tax rate changed significantly, you may want to change your tax withholdings on your paycheck or other sources of income and make sure you are withholding an appropriate amount.
Money Tip 4/8/19
Don’t be a victim of identity theft and other fraud schemes. In order to defend yourself, consider setting alerts on your accounts. Most banks and credit card companies will alert you instantly about purchases above a certain dollar amount. It’s normally very easy to login to your account and set up these alerts. You should also review your accounts periodically for any unauthorized purchases.
Money Tip 4/1/19
Make sure you have an emergency fund. If you are still working, a good rule of thumb is 6 months of income in the emergency fund. If you are retired or retiring soon, think about keeping 5% to 10% of your investment net worth in your emergency fund. If you take money out for an emergency, remember to replenish it soon.
Money Tip 3/25/19
If you are participating in your employer’s retirement plan, find out if it has a Roth option available. Consider contributing into the Roth rather than pre-tax or at least a combination of Roth and pre-tax. There are rules to understand when it comes to Roth so you should consult a financial professional to make sure this is right for you.
Money Tip 3/18/19
Savings should be part of your budget. Just like a necessary expense such as spending on groceries and housing, savings should be a necessity. Similar to a 401(k) contribution that comes directly out of your paycheck, use a similar mechanism to save monthly. We recommend using automatic drafts for monthly savings and investing. You should aim for a total of at least 10% of your income going to some sort of long-term savings.
Money Tip 3/11/19
No matter what age you are, you should have a very solid understanding of how much you spend every month. There are online tools available to you but if you do not want to use online tools, try writing down everything you spend for 2 or 3 months. Then write your average monthly spending down where can see it on a regular basis. Remember, what you can measure you can manage. Measure your spending so that you can manage to keep it at or below your goal.
Money Tip 3/4/19
Many Americans who have not saved enough for retirement often say that they will simply work longer and retire later. However, over a third of Americans who have retired report that they retired earlier than they had planned. They retired earlier as a result of health reasons, company layoffs, grandchildren or caring for an aging parent. This statistic emphasizes that saving for retirement is so important. You may end up retiring earlier than you expected.