Monday, June 1, 2015, PM | Leave Comment
I have followed some finance experts who tell me to boost up contribution to my retirement account. They have been saying almost the same things since I turned 55. For some, it might seem ages ago and for others, probably yesterday. I just turned 65.
You decide whether the following reminder applies to you or not. If it does, take action and benefit from it.
I hope you have taken advantages of these benefits already. If not, consider it a reminder to do so.
The consensus of almost all finance experts
Examine your family state of finances and take some action if you can afford it. Talk to your financial adviser if you feel you should.
Max-out your contributions
The IRS has released 2015 employer sponsored retirement plan limits, which covers 401(k), 403(b), and Government Thrift Savings (TSP) plans.
The annual contribution limit, which is indexed to inflation, increased again by $500. That means the maximum amount employees will be able to contribute on a pre-tax basis in 2015 will be $18,000 (vs $17,500 in 2014).
Catch-up contribution benefit
The catch-up pre-tax contribution limit available to employees over 50 also increased by $500 to $6,000 in 2015. If you are 50 or over, you can contribute $5,500 more for a total of $22,000 in 401(k).
Saving account like Roth IRA
Unlike regular IRAs, Roth IRA allows already-taxed contributions to grow tax free.
Hold off taking Social Security
You can start drawing Social Security payments as soon as you reach age 62 if and when you need the money. But in case where you don’t, then hold off your social security. Your full benefits start somewhere between 65 and 67. That would depend on the year you were born.
In a Nutshell
When you are over 50, chances are your kids are probably on their own, have moved out. So, if the lightening of joblessness has not fallen on your head and your sanity is still intact, then you might want to take advantage of trying to boost up contribution to your retirement. It will do you some good when you get to be a lot more wiser and be able to enjoy life.