Thursday, 31 January 2019

Your Retirement Future


How do you picture your retirement future? Is it bright and comfortable or dark and laborious? What are your retirement dreams? Eleanor Roosevelt once said, "The future belongs to those who believe in the beauty of their dreams." You, and only you, have control over your retirement future. Use these steps to ensure you get the retirement you want. 

Start Now 

The sooner you start, the more likely that you will meet your retirement goals - both financially and emotionally. Even if you are late (over fifty) to the retirement planning stage, there is no need to surrender to a bleak retirement future. 

Set Your Goals 

If you do not know your retirement dream goals, how can you ever expect to reach them? One of the first steps to ensure a comfortable and rewarding retirement future is to determine your dream goals. Where do you plan to live? If you are planning to move after retirement, is the new location less or more expensive than where you live now? What hobbies do you plan to participate in retirement? Do you have the funds to pursue these? 

Educate Yourself 

To keep informed about retirement topics, try a FREE membership to Retirement Intelligence Information Services. At no cost to join, you will receive a bi-monthly newsletter full of financial information to inform and empower you to have a successful retirement. 

Know Your Needs 

Most financial planners suggest that you will need at least 75 percent of your pre-retirement pay, to ensure a comfortable retirement. This percent comes from a combination of a pension, Social Security and personal savings. Because Social Security and pensions plans are in jeopardy, it is up to you to fund your entire retirement. 

Pay Yourself 

First put aside money for yourself first, then pay everyone else. Combine this with setting up automatic savings and investment plans for your retirement - and you have a recipe for retirement success. 

Hands Off 

Just as important as saving enough and investing your savings wisely, is not touching your retirement funds. By not using your money set aside your retirement, you will allow your money to grow at a compound rate and help ensure that your dreams of a comfortable retirement come true. Also, in the case of pre-tax retirement accounts, you will avoid early withdrawal penalties. Making Your Dreams a Reality I hope your picture of your retirement future is a little brighter. Remember you control your retirement future. Following the preceding steps can help you successfully reach your retirement goals. 

Manage My Retirement, Please!


The truth is anyone can be a financial planner or advisor. Financial planners do not even need a high school degree. So, before you hand over your hard earned money to just anyone, you need to learn about them. But, how do you choose a reputable financial planner? Finding the perfect financial planner does not have to be an impossible task. By following these steps, you can find the right person to manage your retirement. 

Get referrals 

Ask family and friends who they use. Other financial professionals can be a great resource for referrals. CPAs, Bookkeepers, estate and tax lawyers are just some of the professionals that can offer great leads. Professional associations offer a treasure trove of potential money managers. 

Ask questions 

What experience do you have as a financial planner? 
Why you ask the question: This gives you an idea of how experienced the planner is. 
The ideal answer: The more experience the better. 
What kind of training/education do you have? 
Why you ask the question: As stated earlier, anyone can be a financial advisor. You want to make sure you choose a planner that is well educated in finance and investing. 
The ideal answer: A business degree - either finance or accounting degree are preferred, but if the planner has an MBA or other graduate finance or accounting degree is all the better. People with these degrees have the obvious financial training, but less obvious is that they tend to be detailed-oriented and make the best advisors. Also look for any of the CFP, CFA, or CPA designations. What licenses do you hold? Why you ask the question: If they are not licensed to sell securities and insurance, walk away. Series 6 allows the agent to sell mutual funds and variable annuities.
Series 7 allows the agent to sell corporate securities.




Wednesday, 30 January 2019

How do You Perform a Retirement Health Check


In order to perform a retirement health check, you must first identify which of the following plans you plan on using to fund your retirement. Potential problems with each plan are shown below. Performing a retirement health check is the only way to know if your plans will result in a match to your retirement goals and desires. When reviewing your plan, remember that most financial experts suggest that you will need at least 75 percent of your pre-retirement income, in order to maintain your standard of living in retirement. 

  • Social Security Only The Social Security Agency states, "under current law, if you have average earnings, your Social Security retirement benefits will replace only about 40 percent, so you'll need to supplement your benefits with a pension, savings or investments." Thus, you as an individual must create a plan that will replace the remaining 35 percent or cut your living expenses by an equal amount. But, with current funding of Social Security, it is estimated that all funds will be depleted around 2030 and diminishing payments are expected to start well before then. Because of its uncertainty and low-income replacement possibilities, this is one of the poorest plans you can make. 
  • Pension Only You are lucky enough to have a good paying pension. You plan to use money from your pension as your only source of income if Social Security does pay you anything, great, but you're not planning on it. Unfortunately, this plan may not be as safe as you think. Several major companies in the steel and airline industries have already defaulted on their pension plans. There is speculation that the next major industry to default on their pension plans will be the automotive industry, including both automotive manufacturers and automotive suppliers alike. Other industries may default as well. If your pension defaults, what will you do then? 
  • Social Security plus Pension Read the above paragraphs to see why this is not the best plan. 
  • Social Security plus Some Investments Read the "Social Security-Only" paragraph above and consider how your plan will hold up if you have to live on your investments alone. You do not have to guess what your future would look like. Using this retirement calculator, you can see it now. 
  • Pension plus Some Investments Read the "Pension Only" paragraph above and consider how comfortable your retirement will be if you have to live on your investments alone. Using this retirement calculator, you can see what your future would look like. 
  • Social Security, Pension and Some Investments You're no fool. You know that there is a good chance that either Social Security or your pension may default, so you've made some investments too to be on the safe side. Have you considered how your plan will hold up if you have to live a long life and if one of or both of these external income sources fail? Although this is one of the better plans you can make for your future, you still need to run "what-if" scenarios with the help from a retirement calculator. 
  • Investments Only This can be the best plan of all if executed properly. A study conducted by the U.S. Department of Commerce found that, sadly, only 5 percent of Americans have saved and invested enough money to be financially independent at age 65. So make sure your retirement investments are on track by using a retirement calculator. With this plan, if your pension, Social Security or both do come through, then you have to use this "found" money to donate to your favorite charity or spoil the grandkids. So now that you have identified your plan and practiced your retirement through the use of a retirement calculator, you can start tracking your progress. This is a good first step toward your retirement education. 

What is Your Retirement Projection?


Your retirement projection is directly dependent on your current savings and investment plan. Do you know your retirement projection? If you do not know, you could very well end up among the 95% of Americans who are not financially independent at age 65 - this according to a study conducted by the U.S. Department of Commerce. In addition, the government's study also showed that only a dismal 25 percent of all retirees are able to avoid dependence on Social Security, family, and friends as their only sources of income. 

Generally, you will need at least 75 percent of your pre-retirement income to ensure a comfortable retirement, according to most financial experts. Once you know where you are and where you need to be, the next step can be taken. You should start your financial education by reading finance magazines, newspapers and websites. Attendance at investment classes is another great option.  

Also, consider a FREE subscription to Retirement Intelligence Information Services. The newsletter mission is to help you, the individual investor, become informed and empowered to take over control of your investments. Take the next step toward your secure retirement today. 

Retire on Track


In the years since World War II, the United States has seen incredible growth in affluence as a nation. But, most Americans are still not investing enough for their retirement. In the world's most affluent society in all of history very, very few individuals ever achieve a position of being able to live off the resources they have accumulated. The vast majority are dependent on the government, relatives, charity, or they must continue to work in order to have enough income to meet their needs. 

This statement has been confirmed by a study conducted by the U.S. Department of Commerce - the devastating reality is 75 percent of Americans rely on Social Security, family, and friends as their only sources of income. Additionally, the Department of Commerce's study found that, sadly, only 5 percent of Americans have saved and invested enough money to be financially independent at age 65. All is not lost. You can change your retirement future. 

Your secure retirement future starts with a solid financial plan. Always keep in mind that the earlier you start planning the better, but it is never too late to start planning for your retirement. Start with the creation of a complete financial plan, which includes: Determination of your ideal asset allocation, Consideration of the impact of management fee has on your portfolio, Management of tax liability, The impact of inflation has on your portfolio, and Calculation of the appropriate withdrawal rate.

Calculation of your appropriate withdrawal rate is extremely important. You need to make sure you follow the government's minimum distribution requirements for retirement accounts. You are the best person to manage your money. 

Make Your Dreams of a Comfortable Retirement a Reality


Every worker dreams of a comfortable retirement. Medical breakthroughs have to lead to a dramatic increase in life expectancies. The Centers for Disease Control and Prevention (CDC) tracks life expectancies. It is most prudent to use the life expectancy of the younger spouse, plus at least an additional five years to the figures provided by the CDC. Because of these longer life expectancies; we can expect to spend more years in retirement than our parents did. But, with these long years in retirement, comes more complicated financial planning than our parents had as well. 

You expect after retirement to have your mortgage paid off and your kids off on their own. But, if your dream is to sail around the world, pay for the grandkids travel costs to see you several times a year or start your own business, then you will need to consider a much higher percentage. In these cases, you should create a plan whose percentage is closer to one hundred. Whether you are three months, three years, or 30 years away from retirement, it is never too early, or late, to start planning. 

Through the creation of the correct retirement income plan now, you can make a big difference in how comfortable your retirement will be. You have worked hard for what you have; you deserve to make your dreams of a comfortable retirement a reality. 

Be Aware of Retirement Scams


There really is no magic retirement plan that can get you ready for retirement quickly. But the good news is there is still hope. The sooner you start, the more likely that you will meet your retirement goals - both financially and emotionally. Even if you are late (over fifty) to the retirement planning stage, there is no need to surrender to a bleak retirement future. 

Specialists warned against different investment scams. Often times, unscrupulous, so-called financial advisors take advantage of investors looking to make money quickly. They use buzz-words to sell you their investment products, like "guaranteed", "limited offer", "safe as a Certificate of Deposit", and "risk-free". Use of complicated language is also used to confuse you. They do this because they know most people will not ask for clarification, because it may make them appear stupid. 

It is advised to be wary of advisors who recommend exotic or unusual products. If your inner voice is telling you it sounds too good to be true, it probably is! 

Your retirement future can be bright if you take the right steps toward retirement planning now. Remember you control your retirement future. 

Help! I Need Retirement Guidance


All the information available on retirement can be overwhelming. To start or continue your retirement education, consider a subscription to The Retirement Intelligence Information Services newsletter. The newsletter provides investment education in short informative articles, just like this one. 

Cash Reserves

You should have between two months' and a year's worth of spending in cash reserves at all times. The amount of reserves you will need depends on the stability of your income. Your cash reserves should be kept in safe and liquid investments - saving or checking accounts, U.S. Treasury bills, short-term bank CDs and money market funds. If you have credit card debt, pay it off first, before funding your emergency fund. Once the debt is paid off, consider investing to Roth IRA. This may earn you a better return on your money. Follow the plan above that will allow you to sleep the best at night. 

Retirement Plans and Accounts

If your employer does any sort of matching contribution, then your retirement planning needs will be best met by fully participating in your employer's retirement plan. If your company does not match your contributions, then contribute the maximum to your Roth IRA, only then should you explore using your company's retirement plan or other retirement account options. 

Who has the Time to Read Retirement Books?


Because of changes in life expectancies, retirement plans and government programs, we live in a world different than any previous generation could have envisioned. Past generations did not have to worry about reading the latest retirement book to learn about retirement planning because it really was not a concern for them. Most workers of past generations spent less than five years in retirement. 

Today, most of us can expect to spend the same amount of time in retirement as we did when we worked. Every worker must learn about finance and investing to ensure a comfortable retirement. Do not think of this learning process as an educational obligation, but rather as an educational adventure. You may even find it enjoyable. If you do not believe me, then perhaps Mr. Einstein will convince you. Albert Einstein said, "Never regard study as a duty, but as the enviable opportunity to learn to know the liberating influence of beauty in the realm of the spirit for your own personal joy and to the profit of the community to which your later work belongs." You can obtain your finance and investing education in a variety of ways. Books, magazines, newsletters and the internet all can be used in your educational arsenal. 

But, really, who has the time to read retirement books? Magazines are better for the time-constrained worker, but how do you access the information again when you want it? Do you hold on to all the magazines or just clip the articles you find helpful? This can take up a lot of your valuable real-estate and time. This leaves us with searching the internet and newsletters. Searching the internet can take a lot of your precious time to locate articles that you will find useful to your education. Who wants to spend the time searching for education rather than actually learning? Perhaps the best first step you can take on your financial education adventure is to try a FREE subscription to the Retirement Intelligence Information Services newsletter. The newsletter provides investment education in easy to understand terms, to help you, the individual investor. The articles are to-the-point and full of valuable information. 

Your Retirement Income Guide


It is crucial that you develop your retirement income guide now. Most of us can expect to spend the same amount of time in retirement as we did when we worked. Unfortunately, most of us are not properly prepared for this. Only five percent of all Americans are financially independent at age 65 - this according to a study conducted by the U.S. Department of Commerce. In addition, the government's study also showed that a shocking 75 percent of all retirees are forced to depend on Social Security, family, and friends as their only sources of income. 

The proper retirement income guide can help you from becoming one of the government's sad statistics. Development of your income guide starts with the use of a retirement calculator. This will help to identify any shortfalls with your current retirement income guide. If there is a shortfall, you can plan to work more hours or for more years, take a smaller annual withdrawal amount, and/or increase your savings rate. 

But, there are three key ingredients for a successful retirement - financial well-being, emotional well-being, and physical well-being. Your physical, financial and emotional well-being are tied closely together. If your financial well-being is at stake, then often so are your emotional and physical well-being. For example, suppose you do not have enough money to purchase the medication your doctor has prescribed for you - then your health will likely deteriorate - leading to depression. Likewise, if your physical well-being is compromised, you will have to pay medical and household maintenance expenses - which can lead to a financial crisis - if not properly planned. 

To keep your physical well-being in check - make regular doctor visits, take any medicine prescribed by your doctor exactly as prescribed, exercised regularly, and eat healthy food. Your emotional well-being is a little harder to pinpoint the exact steps to take to ensure it stays on course. Visiting with friends or relatives, learning something new, hobbies and spiritual pursuits are all good places to start. Keep your retirement income guide on track by becoming educated about finances. This does not mean you have to depend solely on your own financial talents. Even the most seasoned investors need some professional retirement planning help. 

Retirement Expenses and You


Most financial experts suggest that you will need at least 75 percent of your pre-retirement income, in order to maintain your standard of living in retirement. This may not be as easy as you might think. On the Social Security Agency's on web site, they state "Under current law, if you have average earnings, your Social Security retirement benefits will replace only about 40 percent, so you'll need to supplement your benefits with a pension, savings or investments." Thus, you as an individual must create a plan that will replace the remaining 35 percent (or 75 percent, if you believe Social Security is not secure) of your pre-retirement income. 

The majority of Americans mistakenly believe they can live on less than the recommended 75 percent. They think that in retirement they will have significantly fewer expenses, such as no mortgage payment. But, while this may be true, other expenses generally increase. These increased retirement expenses include - health care costs, travel expenses, and household expenses (i.e. you may need to hire a lawn service and snow removal because you can no longer handle this responsibility physically). But, the biggest retirement expense really is not an expense at all, but rather a loss of purchasing power due to inflation. 

Historically, the inflation rate has been about 3 percent. Did you know that with just the average inflation rate of 3 percent, it costs double every twenty-four years? Most of us can expect to spend as much time in retirement as we did when we worked. Thus, we can expect to see our expenses double during our retirement years. Ouch. So what can be done to ensure you have saved enough toward your retirement? You have worked hard for what you have; do not let your retirement comfort be compromised. Take the next step toward your secure retirement today.

Retirement: Golfing is Good for You!


One of the best ways to avoid boredom and depression in retirement is to participate in several hobbies. If golf is one of your hobbies now, then plan to kick it up a notch in retirement. Research has shown that seniors who participated in at least some group activities are less prone to depression, health problems and live longer lives. So, in addition to playing solo rounds - join a golf league and go to golf clinics or golf tournaments with a friend. 

The International Golf Federation also conducts the amateur team competitions. But, you will not be able to golf in retirement or participate in any of your other hobbies if you have not adequately planned for your retirement. Make sure you have the financial resources to participate in the hobbies you choose. 

Also consider a subscription to the Retirement Intelligence Information Services newsletter, which provides retirement news and investment education for the individual investor. Retirement can be a great time to devote more time to golf and other hobbies as well. Make sure the hobbies you choose are a mixture of solo and group activities. It is also important to include activities with people already in your social network, as well as those who are not. People who plan an active life after retirement tend to be happier, healthier, and live longer than those who have no such plans. So, that is an order, play golf in retirement - it is good for you. 

What is Your Retirement Outcome?


Your retirement outcome is directly dependent on your current savings and investments plan. 

Do you know your retirement outcome? If you do not know, you could very well be among the 95% of Americans who are not financially independent at age 65 - this according to a study conducted by the U.S. Department of Commerce. In addition, the government's study also showed that a dismal 25 percent of all retirees are able to avoid dependence on Social Security, family and friends as their only sources of income. 

To make sure your retirement outcome is the one you desire, read on. The best way to discover if your retirement outcome is on target, is the use of a retirement calculator. Using this calculator will help you to identify any shortfall now before it is too late. Generally, you will need at least 75 percent of your pre-retirement income to ensure a comfortable retirement, according to most financial experts. Once you know where you are and where you need to be, the next step can be taken. 

The next step is to educate yourself about finance and investing. You should start your financial education by reading finance magazines, newspapers and web sites. Attendance at investment classes is another great option. You can also check the course offerings at your local college.  If you have a particular investment or financial question you would like answered, the Retirement Intelligence Information Services newsletter can answer it. Above all remember that your education is a lifelong process. 

Do not expect to know everything you need to know overnight. You have worked hard for what you have; do not let your retirement outcome be compromised. Take the next step toward your secure retirement today. 

The Latest Retirement Trend


Almost half - 45 percent - of all baby boomers are expected to move to another home in retirement. This retirement trend has lead to the boom of publications dedicated solely to retirement living. While there are still plenty of retirees flocking south seeking warmer weather, the latest trend among these retirees has little to do with climate. Instead of mild winters, retirees are on a quest to find the perfect blend of safety and cultural activity. There are two types of retirement communities that are thriving in this latest trend. Active Adult Retirement Communities (AARCs) are retirement communities where residents are typically at least 55 years old and want to maintain an active independent lifestyle. These communities often offer all the luxuries of an exclusive resort - swimming pools, spa facilities, and private movie theatres. In fact, many AARCs are planned around golf courses and airports (these communities sport aircraft taxiways that start at the end of the resident's driveways.) Many universities now have retirement housing and invite their alumni to return "home." The list of universities sporting these retirement complexes is impressive - Michigan, Cornell, Penn State, Duke, Iowa State, Cornell, Alabama, University of Florida, and Louisiana State among others. These living arrangements offer both benefits to the residents and the university alike. The retirees benefit from the cultural stimulation that college towns offer and some find a place to continue their work - when they may have been shunned by other employers - through teaching classes. The universities benefit from having a ready-made population for its researchers to study aging and university-run hospitals gain new patients. Before relocating to any retirement community ask these questions: 
  • Is it a low crime area? 
  • Is the community close to friends and family? 
  • Is quality health care available? 
  • What are the costs of living and taxes for the area? 
  • What is the weather like? 
  • Does the location fit my lifestyle? 
  • How far away are your favorite activities (i.e. concerts, parks, fishing, golf, museums, shops, religious centers, etc)? 
  • How do I keep up-to-date on the latest retirement trends and news impacting my retirement? 

To keep informed about retirement topics, try a FREE membership to Retirement Intelligence Information Services. At no cost to join, you will receive a bi-monthly newsletter full of financial information to inform and empower you to have a successful retirement. 

Tuesday, 29 January 2019

Retirement Analytics


Analytics is the most sophisticated analysis of data. It allows better decisions to be made. Retirement Analytics is data that helps track investment trends. If you are among the majority of Americans who do not plan to work in retirement, then you need a retirement calculator that utilizes the latest retirement analytics. Through the retirement calculator, you can see 
  • how management fees impact your plan,  
  • how inflation will play a hand in your retirement, 
  • if your asset allocation stands up to performance analysis, and 
  • your appropriate withdrawal rate. 

This crucial retirement analytics are explained below: 
  • Through the use of the retirement calculator you can view the impact that management fees have on your plan. Usually, management fees account for roughly one percent loss of your portfolio each year. One percent may not sound like an insignificant amount until you consider that on a $300,000 portfolio, that means you will have to make $3,000 a year to just breakeven. 
  • Do not underestimate the withering effects of inflation on your purchasing power. Historically, the inflation rate has been about 3 percent. Thus, with just the average inflation rate of 3 percent, your costs double every twenty-four years. You can expect to spend as much time in retirement as you did when you worked. Therefore, you can expect to see your expenses double during your retirement years. Ouch. 
  • If your assets are invested too conservatively, you risk that your money will not keep pace with your expenses and you will run out of money before the end of your life. Conservative investing usually means that a significant portion of your retirement portfolio in low-risk, low-return asset - like bonds, T-bills, savings accounts and money market funds. 
  • Calculation of your appropriate withdrawal rate is extremely important. You need to make sure you follow the government's minimum distribution requirements for retirement accounts. 

This is another item that can easily be projected with the help of a good retirement calculator like the one found at retirementcalc.com. How do I keep up-to-date on the latest news impacting my retirement? To keep informed about retirement topics, try a FREE membership to Retirement Intelligence Information Services. At no cost to join, you will receive a bi-monthly newsletter full of financial information to inform and empower you to have a successful retirement. 

Retirement Intelligence


From the U.S. Government's own Social Security web site - "Under current law, if you have average earnings, your Social Security retirement benefits will replace only about 40 percent, so you'll need to supplement your benefits with a pension, savings or investments." This assumes, of course, that Social Security is secure and will be around throughout your entire retirement. Most financial planners suggest that retirees will need at least 75 percent of their pre-retirement pay, to ensure a comfortable retirement. This percent comes from a combination of a pension, Social Security and personal savings. Pensions are scarce, and if you are one of the lucky ones to have a pension, these are becoming less secure. Just ask any United Airlines worker. Thus, more and more it is up to us, the individual, to fund our entire retirement. The FREE Retirement Intelligence Information Services newsletter provides investment education in easy to understand terms, to help you, the individual investor. The service is absolutely 100% FREE for everyone. Providing intelligent retirement information is our passion. Through the Retirement Intelligence Information Services newsletter, you will become informed and empowered to take over control of your investments. Topics covered by the Retirement Intelligence Information Services newsletter include: 

  • The Retirement Calculator
  • Introduction to multiple Multi-Million Dollar business opportunities. 
  • Health Insurance and Health Care Costs 
  • Retirement News Letters 
  • Where to Retire 
  • Resources Retirement Communities 
  • Retirement Planning Resources 
  • Asset Allocation Strategies 
  • Money Manager 
  • Jobs over 55 
  • Internet Technologies and Services 
  • Computer Training Information and Resources 
  • Annuities and Long Term Care Estate Planning 
  • Senior and Retirement Websites 
  • Financial e-Books 
  • Retirement Products and Services 
  • Meeting people and making long-lasting Friendships in addition.

Retirement Intelligence Information Services newsletter subscribers are encouraged to submit questions or topics you would like to see covered in the newsletter. 

Retirement Allocation Explained


Often financial "experts" make asset allocation for retirement planning difficult to understand. This article covers what asset allocation is and why it is important the main asset categories and your ideal asset mix.

Asset Allocation 

Asset allocation simply means how your investment portfolio is divided across different asset classes or investment types. This is often confused with diversification. Diversification refers to buying a number of investments within an asset category to reduce investment risk. Asset allocation theory states that by dividing your portfolio into different types of investments, you can reduce the volatility of your portfolio. Some financial experts claim this is more important than the individual stocks you choose. I believe that both proper allocation of your portfolio and the careful selection of investments within each asset category is the key to long-term investment success. The asset allocation of yesteryear used to be simple. The formula was to subtract your age from 100. This resulted in the percentage of your portfolio you should have invested in stocks. For example, a 65-year-old would have 35% in stocks and 65% in bonds and cash. But, due to longer life expectancies, people run the risk that their investments will not grow fast enough to last their lifetime when following this formula. Reading this article and using the retirement calculator can help prevent this from happening to you.

Asset Categories 

There are three main asset categories;

  • Cash and cash equivalents, 
  • Bonds (income investments) and 
  • Stocks (equity investments). 

Each of these categories has risks associated with it. Generally, the more risk you assume, the higher the return. Once you have your ideal mix identified, you can plug these percentages into the retirement calculator. This will help to identify if there is any shortfall with your current plan. If there is a shortfall, you can plan to work longer, take a smaller annual withdrawal amount and/or increase your savings rate. Again, you can plug these "what if" scenarios into the retirement calculator until you no longer have an investment shortfall. Your asset allocation plan is done, for now. 

Monitoring Plans


Retirement plans require a continuous on-going effort to monitor compliance with the Employee Retirement Income Security Act of 1974 (ERISA), the Internal Revenue Code, and other laws and related government regulations. The objective is to avoid non-compliance issues, but should they arise, analyze the available correction alternatives and make recommendations where appropriate.

The annual compliance testing involves monitoring plans for compliance with non-discrimination rules, including ADP and ACP testing, and minimum coverage testing under IRC 410(b). Monitor your Plan's compliance with contribution and benefit limitations under IRC 415 and 402(g), top-heavy status under IRC 416; and where required, perform complex average benefits percentage testing under 410(b) and general testing under 401(a)(4).

RetirementAssets.com's reporting services include signature-ready IRS form 5500 with supporting schedules; Summary Annual Reports; and, 1099 issuance for Plan Distributions.

Your Wealth Management Plan


"Retirement at sixty-five is ridiculous. When I was sixty-five I still had pimples." If you agree with George Burns, then you really do not need a retirement wealth management plan. Working until the end of your life is certainly an option. It is just not the option most of us want to exercise. If you are among the majority of Americans who do not plan to work in retirement, then you need a retirement wealth management plan. The annual Retirement Confidence Survey (RCS) is a comprehensive study of the attitudes and behaviors of American workers and retirees towards all aspects of saving, retirement planning, and long-term financial security. A 2001 RCS published by the Employee Benefit Research Institute (EBRI), American Savings Education Council (ASEC) and Mathew Greenwald & Associates found that the largest source of retirement income for current retirees is as follows: 

  • Social Security
  • Employer-sponsored plans
  • Personal savings
  • Other government income
  • Sale of home or business
  • Employment
  • Support from children/family
  • Other 

The fate of Social Security still remains to be seen. Americans are living fourteen years longer than when Social Security was created, and life expectancies are on the rise. This puts a tremendous strain on the system. If Social Security were forced to make payment cutbacks or if it fails altogether - what will the 42% of current retirees who rely on it, as their largest source of retirement income, do to survive? The second largest source of retirement income for current retirees is employer sponsored plans. The sad fact is that no pension plan is completely secure. United Airlines just joined the growing number of companies defaulting on their pension plans. Pension defaults are not just confined to the airline industry -most companies in the steel industry have already defaulted on their pensions. There is great speculation that the automotive sector (including both automotive manufactures and automotive suppliers) will be the next to default on their pension plans. Again, what will the 23% of current retirees who rely on employer sponsored plans as their largest source of retirement income do to survive? The key to survival, whether your pension fund defaults or Social Security fails, is to develop a retirement wealth management plan. The first step in the creation of your retirement wealth management plan is to check your current retirement status using a retirement calculator. You can run multiple retirement scenarios using the retirement calculator - such as what your retirement looks like without your pension plan. The next step is to educate yourself about finance and investing. You should read finance magazines, newspapers and web sites. Attendance of financial classes is another great option. You can also check the course offerings at your local college. The bottom line - do not rely on a company or the government to provide your retirement - you must take an active role in securing your own retirement. It all starts with your retirement wealth management plan. 

Retirement Practice Makes Perfect


Practicing for retirement is the only way to know if your plans will result in a match to your goals and desires. Which of the following plans do you plan on using to fund your retirement? When reviewing your plan, remember that most financial experts suggest that you will need at least 75 percent of your pre-retirement income, in order to maintain your standard of living in retirement.

1. Social Security Only

The Social Security Agency states, "under current law, if you have average earnings, your Social Security retirement benefits will replace only about 40 percent, so you'll need to supplement your benefits with a pension, savings or investments." Thus, you as an individual must create a plan that will replace the remaining 35 percent or cut your living expenses by an equal amount. But, with current funding of Social Security, it is estimated that all funds will be depleted around 2030 and diminishing payments are expected to start well before then. Because of its uncertainty and low-income replacement possibilities, this is one of the poorest plans you can make.

2. Pension Only

You are lucky enough to have a good paying pension. You plan to use money from your pension as your only source of income if Social Security does pay you anything, great, but you're not planning on it. Unfortunately, this plan may not be as safe as you think. Several major companies in the steel and airline industries have already defaulted on their pension plans. There is speculation that the next major industry to default on their pension plans will be the automotive industry, including both automotive manufacturers and automotive suppliers alike. Other industries may default as well. If your pension defaults, what will you do then?

3. Social Security plus Pension

Read the above paragraphs to see why this is not the best plan.

4. Social Security plus Some Investments

Read the "Social Security Only" paragraph above and consider how your plan will hold up if you have to live on your investments alone. You do not have to guess what your future would look like. Using this retirement calculator, you can see it now.

5. Pension plus Some Investments

Read the "Pension Only" paragraph above and consider how comfortable your retirement will be if you have to live on your investments alone. Using this retirement calculator, you can see what your future would look like.

6. Social Security, Pension and Some Investments

You're no fool. You know that there is a good chance that either Social Security or your pension may default, so you've made some investments too to be on the safe side. Have you considered how your plan will hold up if you have to live if one of or both of these external income sources fails? Although this is one of the better plans you can make for your future, you still need to run "what-if" scenarios with the help from a retirement calculator.

7. Investments Only

This can be the best plan of all if executed properly. A study conducted by the U.S. Department of Commerce found that, sadly, only 5 percent of Americans have saved and invested enough money to be financially independent at age 65. So make sure your retirement investments are on track by using a retirement calculator. With this plan, if your pension, Social Security or both do come through, then you have used this "found" money to donate to your favorite charity or spoil the grandkids.

So now that you have identified your plan and practiced your retirement through the use of a retirement calculator, you can start tracking your progress. This is a good first step toward your retirement education. To take control of your retirement future, consider a FREE subscription to the Retirement Intelligence Information Services newsletter, which provides investment education in easy to understand terms. The service is absolutely 100% FREE for everyone.

 
Copyright © 2019 Retirement Plans Advice .