Stick To Your 2009 Financial Resolution
Wed Feb 4, 2009, 12:53 am | Leave Comment
2008 was a volatile and financially uncertain year and 2009 seem to be the same. There are still certain things you can do to get back on track to your financial success, especially in your retirement. Remember to look for new opportunities. The following 2009 resolutions offer very specific steps to consider that can provide more financial discipline and better prepare you for retirement.
Based on your age, you can take different steps that can lead you to financial success in your retirement.
Between the ages of 25 and 35
If you are in this age group, you have quite some time to prepare for retirement.
- Learn About Your Employer’s Retirement Plan. If you are covered under your employer’s retirement plan, your employer is required to give you a plain language explanation of the plan called a “summary plan description.”
- Develop a strategy to achieve long-term goals. It’s easy to procrastinate so set up a “painless” payroll deduction for saving.
- Enroll in 401(k) plan and contribute maximum amount, if possible. The 401(k) limit is $16,500 for 2009.
- Open and contribute to an IRA based on your savings goals. IRAs are easy to get, easy to contribute to and easy to save with. Most Americans can set up an IRA – whether it’s a traditional IRA or a Roth IRA – and save on taxes.
Between the ages of 36 and 54
In this age group, you are at a peak as far as your earnings. You generally need to refine and manage your retirement strategy and contribution levels.
- Monitor and re-balance your portfolio at least once a year.
- Catch up and/or max out on 401(k) plan. If you are 50 or older, you can contribute an additional $5,500 to your 401(k) plan in 2009 for a total maximum of $22,000.
- IRAs also allow an additional $1,000 in contributions for 2009 for older workers.
- Simplify and consolidate your assets.
55 or older
Investors who are within five to 10 years of retirement should anticipate needs and take action to make sure they are prepared.
- Create income plan for your retirement to determine when you can retire. That will ensure a steady income to cover your most important expenses.
- Sign up for Social Security and Medicare. You can sign up for Social Security benefits as early as age 62.
Take Your Required Minimum Distributions
If you are 70-1/2, you are generally required to receive a required minimum amount from your qualified retirement plan or IRA by year-end.
Review Your Social Security Statement
When the Social Security Administration sends you a Social Security Statement, it is your personal record of earnings on which you have paid Social Security taxes and a summary of estimated benefits you and your family may receive as result of those earnings.
These benefits include retirement benefits and protection in case you become disabled or die before retirement age. For more information, request a Social Security Statement.
Learn About Your Spouse’s Retirement Plan
Many retirement plans provide benefits for spouses. So be aware of it.
In a Nutshell
Whatever age group you belong to, always have a good strategy for retirement whether that’s IRA or 401(k). Every year assess your strategy and the financial products you take part in and re-balance, if need be.
