A recent report said that only 13% of Americans believe they will be able to retire in comfort due to the current recession throwing them a curveball. I know that a lot of people are pessimistic right now. But it's not the time to panic, but be purposeful instead!
Gone are the days when we can trust the company, social security or Uncle Sugar to fund our retirement--but it doesn't mean we're without resources! I went on Neil Cavuto this week to talk about ways we can take charge of our own retirement and regain hope that we WILL be able to still have the gold in those golden years!
**PARTICIPATE - take advantage of 401(k)s in your company while you can, maxing out the matching portion. Yes, the market stinks, but the matching portion is FREE MONEY and even a 25% match is better than anything you're going to see in today's market.
**PRIORITIZE - start to be more agrressive in taking charge of your retirement by fully funding ROTH or traditional IRAs, including catchup funds if you qualify. Or, if you or your spouse own a homebased business, then fund a SEP (Simplified Employee Pension) IRA. Not only will it help you fund retirement tomorrow, but it will give you a significant tax break today!
**PURSUE - look at alternate sources for retirement funding such as HSAs (health savings accounts) that are tax favored, can be rolled over each year & are available at retirement. This would be a supplemental fund for retirement, not a primary. It basically works like this: you buy a high deductible insurance policy (and save tons on insurance), then you put the amount of your deductible into an HSA. So if a family had a $2500 deductible, they can put that amount into this account every year. If they don't use it on medical related expenses, then it will continue to rollover and grow until retirement. Go to http://www.ehealthinsurance.com/ for more info.
**PROJECT - what will you really need for retirement? Reevaluate & simplify to streamline your retirement needs, downsizing as necessary. By having an accurate estimation of your expectations and adjusting them to meet your projected income, then you can still retire, but maybe just do some things differently. Go to my tool center for a cool calculator that will help estimate what you'll need at retirement.
**PRIORITIZE - start to be more agrressive in taking charge of your retirement by fully funding ROTH or traditional IRAs, including catchup funds if you qualify. Or, if you or your spouse own a homebased business, then fund a SEP (Simplified Employee Pension) IRA. Not only will it help you fund retirement tomorrow, but it will give you a significant tax break today!
**PURSUE - look at alternate sources for retirement funding such as HSAs (health savings accounts) that are tax favored, can be rolled over each year & are available at retirement. This would be a supplemental fund for retirement, not a primary. It basically works like this: you buy a high deductible insurance policy (and save tons on insurance), then you put the amount of your deductible into an HSA. So if a family had a $2500 deductible, they can put that amount into this account every year. If they don't use it on medical related expenses, then it will continue to rollover and grow until retirement. Go to http://www.ehealthinsurance.com/ for more info.
**PROJECT - what will you really need for retirement? Reevaluate & simplify to streamline your retirement needs, downsizing as necessary. By having an accurate estimation of your expectations and adjusting them to meet your projected income, then you can still retire, but maybe just do some things differently. Go to my tool center for a cool calculator that will help estimate what you'll need at retirement.
**PROTECT - learm to guard your retirement from people & projects that would deteriorate your funds. Even well meaning folks can mess you up big time. For example, now is NOT the time to loan your Uncle Harry $50K for his dream of starting an Emu farm! As parents to seven kids, my hubby and I know that bailing kids out of consumer debt or trying to fix their financial problems could also leave use vulnerable to a deterioriated retirement fund. So we set the precedence with the older ones by refusing to co-sign, bailout or fund anything that has to do with consumer debt. When it comes to giving friends or family long term loans, investing in speculative businesses, etc--JUST SAY NO!
Happy Retirement,
Ellie Kay
America's Family Financial Expert (R)
