4 Tips to Get Started on Retirement Planning

Can you imagine going on an extended vacation without making any plans? No websites or tour guides consulted. No hotel reservations made. No itinerary mapped out.

Of course not. If you wanted your vacation to be a success, you’d budget enough money to cover your costs. You’d know when you were going, how long you could stay and at least generally what you would do while there.

But when it comes to the longest vacation most people will ever take – retirement – fewer than half of all Americans have a formal plan. And that can spell trouble.

“There’s nothing worse than being 85 years old, full of life, and being flat broke,” says Randy Becker financial, a retirement planner and co-founder of the Becker Retirement Group in Bellevue, Washington.

But it takes some work to avoid the many pitfalls that can ruin your golden years, Becker says. Inflation, taxes, bad health and bad investments can be devastating.

“It’s up to you to have a sound plan so you can focus on the important aspects of a wonderful retirement life,” he says.

Randy Becker Financial offers these tips for getting started so you’ll know you’re ready to begin your retirement journey:

• Get Everybody on Board - You and your spouse need to agree on your retirement goals – and the financial decisions that will get you there. Start talking about priorities: Do you want to relocate? Stay close to the grandkids? Are you emotionally and physically ready for retirement? How long will each of you keep working, and how will that affect the income streams you’ll rely on when those paychecks stop? 

• Make a Budget - Most people think their expenses will go down after they retire, but usually, that doesn’t happen. Your wardrobe budget might go down when you aren’t working, but other expenses might go up if you travel, enjoy new hobbies, or start going out more for dinner, movies, and concerts. 

• Know Where Your Money will Come From - Most financial professionals agree that income is king when it comes to retirement planning. A pile of scattered paperwork and account statements is not a plan. A good advisor can help you maximize your Social Security benefits, come up with tax-efficient distribution strategy and talk to you about other options, such as annuities, that can guarantee income in retirement. This is vital as people now live 20, 30 or even 40 years after retiring. 

• Know Your Retirement Timeline and Reevaluate Your Risk Tolerance - One of the biggest mistakes investors nearing retirement make is sticking with the same advisor and portfolio they had when they were younger. You’ll need to move to a more diversified approach, with fewer risks and more protection for that all-important income.

Although he’s a financial professional, Becker says retirement is about more than money. There’s also the adjustment retirees must make from working every day to suddenly having too much time on their hands.

“Perpetual Saturdays are exciting for about a week,” Randy Becker Financial says. “Maybe you’ll find ways to volunteer. Maybe you’ll learn to paint or play guitar. Maybe you’ll end up working part-time. But most people discover that they need something in retirement that will keep them engaged and excited about life.”

Source URL: http://www.cpapracticeadvisor.com/news/12320254/4-tips-to-get-started-on-retirement-planning

When Should You Retire?

About half of Americans retire between the ages of 61 and 65. Among today’s retired households, a traditional pension or retirement plan appears to be one of the differences between a high- and low-income lifestyle. That’s because, among the 41 percent of retirees whose annual income is less than $25,000, only 21 percent receive income from a pension or retirement plan. Of those who receive $50,000 or more, 80 percent enjoy this form of the income stream. Randy Becker Financial is a Retirement Planning Owner at Becker Retirement Group. He has 30 years experience in the insurance industry and Financial Planning.

For many people contemplating retirement, the question isn’t, “When should I retire?” but rather, “When can I retire?” The answer may be whenever you can afford it. This means that your combined retirement income sources should provide enough for you (and your spouse) to live on for up to 30 years, depending on health and the family gene pool.

According to Randy Becker Financial, the percentage of retirees who claim Social Security before full retirement age has declined recently. That is seen as generally good news because the longer you wait to begin receiving benefits, the more you’ll get. In fact, monthly payouts increase by as much as 6.5 percent to 8 percent a year between ages 62 and 70.

Source Url: http://beckerretirementgroup.com/2017/03/when-should-you-retire/

Maximize Your Savings with a Retirement Plan

Over the last few years, your contribution towards your retirement account makes a big difference. Your biggest asset is time, while you’re young and have decades for you retire. You might not have a lot of money to buy a house, but it’s in your hand to contribute towards retirement because you have so much time ahead of you. Otherwise, years will pass by faster and then you contemplate that you tapped out those funds.

For financial stability and success at the age of 60s, it is significantly important to stay the course with your investment strategy. Be careful about impulsive decisions or be influenced by volatile markets. Ensure your level of risk is appropriate for your shorter time horizon. Below are some strategies disclosed by Randall T. Becker, you can select and choose to assemble your plan for overcoming your savings shortfall. Via these strategies, you can win the retirement planning game.

Compounding Interest

The maximum you put in, the higher you end up with – Interest and Appreciation. Compound interest cycle of earning “interest on interest” which can cause wealth to rapidly snowball. However, the more is your principal amount, the faster interest it will grow. Your money can work better on your behalf if you consider to max out your retirement planning.

For instance: Suppose $10,000 appreciating 8% a year for around 20 years, resulting in worth over $46,600. In case, you manage to get a 10% growth rate, you can aid with almost $67,275. The more you can fund today, the maximum it`ll grow and the more you’ll have over time.

Income Tax Deduction 

Payments towards 401(k), 403(b), and traditional IRA are tax-deductible because these accounts are tax-deferred. At the time of retirement disbursements, the tax paid by you is lesser in amount and a larger portion of your income gets to grow during that time.

On the other hand, Roth accounts are not tax-deductible. Hence, your money will grow tax-free. While contributing to Roth accounts, you can take benefits of tax-free income and end up with more tax-free money in long run.

Permanent Life Insurance 

Among other types of life insurance policies available, permanent life policies can be a lucrative decision to supplement retirement planning. While buying a permanent life insurance plan — either it’s variable, universal or whole life insurance or a hybrid — a few of your premiums get contributed into a separate account that creates cash value alongside or in addition to your death benefit.

Another advantage of permanent life insurance is: The ability to withdraw or borrow against cash value that you can use to pay your mortgage for a few months, in case you lose your job, or to fund your retirement. Be careful about the loans and withdrawals will lower your death benefit unless they are repaid. As Per Randall T. Becker if you borrow more than the surrender value, your policy could lapse.

Rolling over Retirement Funds

In the case of job change, it is important to plan for your employee retirement saving accounts. Either, you have the choice to cash them out, leave them with the employer (if the employer allows this) or roll them over into an IRA or, perhaps, into the 401(k) at your new job.

According to Randy Becker Financial Rolling your employee retirement savings into an IRA is your best option. With an IRA, you can take various investment decision, rather than being limited by the choices in an employee plan.