When you’re in your 20s, you tend to work hard and play hard. But as you get older and settle down, you may find yourself thinking more about the future and trying to keep everything you’ve worked for, rather than scrambling to build wealth. 5 Smart Moves to Make When Near Retirement
As your attitudes and priorities shift, your investment strategy should evolve with them. So here are some smart moves to make as you inch closer to retirement.1. Max out your 401(k) contributions
While the money you contribute to a 401(k) during your last few years in the workforce won’t have much time to grow, you’re best off contributing as much as you can while you’re still bringing in a steady paycheck. This especially holds true if your employer offers a generous matching program. For 2015, the pre-tax contribution limit for 401(k) plan is $18,000, but if you’re 50 or older, you can tack on another $6,000 as a catch-up contribution.Let’s say you’re 55 years old with a 401(k) balance of $100,000, and you want to retire in 10 years. If you max out your contributions, including your catch-up allotment, for a total of $24,000 a year for the next 10 years, then you’ll have an ending balance of $578,000 assuming no employer match and an average annual return of 8%. By contrast, if you opt to allocate $12,000, or half maximum, for the next 10 years, then you’ll end up with just $397,000 based on the same assumptions. 2. Consider an IRA rollover
It used to be that you couldn’t roll your 401(k) into an IRA without leaving your job. These days, many plans allow you to roll your 401(k) into an IRA starting at age 59-1/2, and doing so might offer you better opportunities to diversify your retirement investments, as IRAs offer more options than 401(k) plans do. Many 401(k) plans limit you to specific funds chosen by your employer, but with an IRA, you’re free to invest your money in just about anything, from stocks to bonds to mutual funds. Remember, the closer you get to retirement, the more critical diversification becomes. Having a wide array of investments can serve as a major source of protection during periods of market volatility, so think of an IRA as a blank canvas for mapping out a more comprehensive investment strategy. 3. Choose investments that aren’t as risky
When you’re in your 20s and 30s, you have several decades in the working world ahead of you, which means you’re more free to take risks in the hope that they yield high rewards. As you get closer to retirement, however, you should shift some, though not all, of your investments into lower-risk assets, as your portfolio doesn’t have as much time to recover from market downturns. For many, this means moving away from stocks and putting more money into bonds, which are a safer short-term bet. Another option, if you’re looking for an investment that’s less fickle than stocks but more likely to beat inflation than bonds, then consider putting money into ETFs. Exchange-traded funds offer built-in diversification and have much lower management fees than those associated with mutual funds. A good bet is a fund that seeks to track total U.S. stock market performance, such as Vanguard’s Total Stock Market ETF. 4. Build a bond ladder
While bonds are generally considered to be a safer investment than stocks for near-retirees, they’re not without risk. If a bond-heavy strategy appeals to you, you may want to consider laddering your investment so that your bonds’ respective maturity dates are evenly scattered throughout your target investment period. Taking this approach will help you minimize both your interest rate risk and your reinvestment risk (though you may not be as concerned with the latter, as there’s a good chance you’ll be using your proceeds to fund your retirement lifestyle). 5. Create a budget
If you’ve never mapped out an official budget before, now’s the time to do so. The sooner you get used to the idea of following a budget, the better off you’ll be in retirement, when you’ll have far less wiggle room. Review your monthly bills to figure out your fixed costs, and then build in some room for the variable costs you might encounter, such as home repairs. Compare what you’re spending with what you’re earning now, and also with the amount you’re expecting to have available during retirement. While your monthly expenses may go down a bit in retirement, if you’re within a few years of leaving the workforce, there’s a good chance your current bills will accurately reflect your initial living costs.
Those last few years in the working world are your final opportunity to set yourself up for retirement success. Whether you decide to tweak your investment strategy or ramp up your retirement plan contributions, the key is to get a handle on your finances while you still have a chance to make some changes for the better. A few simple moves could set you on a course for a smooth, financially stable retirement.
The $15,978 Social Security bonus most retirees completely overlook
If you’re like most Americans, you’re a few years (or more) behind on your retirement savings. But a handful of little-known “Social Security secrets” could help ensure a boost in your retirement income. In fact, one MarketWatch reporter argues that if more Americans knew about this, the government would have to shell out an extra $10 billion annually. For example: one easy, 17-minute trick could pay you as much as $15,978 more… each year! Once you learn how to take advantage of all these loopholes, we think you could retire confidently with the peace of mind we’re all after. Simply click here to discover how you can take advantage of these strategies.
Article by The Motley Fool
Intergenerational generosity: Here come the boomers!
During the holidays and especially at Thanksgiving, gratitude is the pervasive theme: gratitude for sustenance, for bounty, for freedom. Gratitude for life itself. Intergenerational generosity from the boomers!
Gratitude can beget generosity. Gratitude is often enhanced by the passage of time and the aging process. In fact, increasing numbers of baby boomers who have had successful career s, whose children are grown, and who may have “powered down,” will likely prove to be the most generous generation in history.
So says Merrill Lynch in a recent research report on giving by retirees. As a group (over 2000 boomers were surveyed), the statistics are impressive. The projection is that “over the next two decades there will be a surge in giving by retirees.” The report calls it the “Longevity Bonus” which includes both outright giving and volunteerism. They quantify the impact as exceeding $8 trillion from 2016-2035.
2014 was a very good year for philanthropy with more than $350 billion in charitable giving according to Giving USA . Ninety percent was outright giving by individuals and their family foundations during their lifetimes, and through legacy giving. Notably, giving by bequest was up 15.5 percent. Giving through donor advised funds, an increasingly attractive option, is not counted as individual giving.
It is estimated that over the next 30 or so years estate distributions will exceed $40 trillion.
Some boomers are heirs to their living parents’ estates and many boomers themselves will become centenarians with an extended retirement and further opportunities to grow their wealth and contribute. Boomer outright and bequest giving to non-profit organizations is trending dramatically upward.
Volunteerism is also on the rise for retirees. They are giving not only treasure but time and talent as well. Some in their “third age” transfer business ownership to heirs, not only for tax reasons but also to focus on their own philanthropy. Some seek encore careers to generate more dollars to give. Some do pro-bono consulting and mentoring to share their professional expertise in ways that substantially assist non-profits.
According to the Merrill Lynch Survey:
Over 80% of retirees over 65 responded that they give money or goods to non-profits and 65 percent believe that “retirement is the best time in life to give back .”
Retirees give 42% of all money given to charity and 45 percent of the volunteer hours while comprising less than a third of the US adult population
Sixty-nine percent of retirees believe that “being generous is an important source of happiness in retirement” and retirees who are charitable indicate they have “a strong sense of purpose” and “high self-esteem.”
Retirees redefine success from career advancement and wealth to generosity; their top motivation is gratitude.
What about giving to family? Philanthropic giving relies on a sense of personal security and most often, giving first to family. Increasing life-spans elongate the time until inheritance and many boomers, some 77 percent, are preferring to give to family members “with a warm hand, not a cold one.”
But there’s a caveat: the word “affluenza” has been used to describe the affliction of the children of the wealthy. Today we might call it entitlement. How do we teach values?
Character? How do we model the concept of “enough?”
Financial and legal advisors are likely to point out that any individual can currently give up to $14,000 a year (the number may increase in future years) to another individual with no gift tax consequences. That’s $28K per couple to each child, their spouse, each grandchild, nieces, nephew, etc. And you can do it (or not do it) every year. That’s a pretty simple estate reduction plan that can avoid some taxation for larger estates.
But how would such gifts be used? A down payment? College tuition? A new car? A gambling junket? To pay off debts from a shopping spree? Does it matter to you?
Each family has its own answer to giving now or giving later, whether tax-wise or not.
Traditional estate planning focuses on passing the maximum amount on to heirs and avoiding taxation. Inter-generational philanthropy begins with passing on fundamental values, including the concept of charitable intent. It involves the desire to teach by example, giving the next generation the chance to discover the joy of giving, and guiding them to learn through their own philanthropic experiences.
Thanksgiving is a good time to have important family conversations about gratitude and giving.
Whether you are an elder, a boomer, the progeny of a boomer or a grand or great-grandchild, it is time to be thankful, to show your gratitude, and to give generously. Enid Ablowitz, CFRE, CSPG, is a veteran advancement professional, author and consultant who is dedicated to educating and guiding donors and non-profit organizations on the art and science of strategic philanthropy.
Couples are putting their plans for a comfortable retirement at risk by avoiding talking to each other about their finances, according to new research. Couples risk retirement avoiding financial planning conversations
The research by insurers Prudential found that one in five (20%) couples over the age of 40 has never discussed financial planning for retirement, while nearly two thirds (63%) say they have never met as a couple with a professional financial adviser to discuss retirement planning.
Each year Prudential surveys couples aged 40-plus on their retirement aspirations and their attitudes to financial planning, and this year’s results show how a reluctance to discuss finances is leading to confusion about their retirement realities.
Nearly half of couples (49%) have no idea about the level of retirement income they can expect when they stop working while 27% do not know how much money their partner has in retirement savings.
The research also identified that many couples are running the risk of leaving one of them in financial difficulties if the worst should happen.
Just two in five (42%) couples have made arrangements for one partner to continue to receive an income in retirement should the other die. A further 15% say that one partner has made a will but no further arrangements regarding a continuing income and 12% have never discussed leaving an income in retirement for each other.
Women are most at risk of being left without an income with nearly one in five (19%) relying on their spouse or social security in retirement, compared with just 8% of men.
Only a third (34%) of respondents said their retirement income will continue to be paid to their partner if they die.
Despite the pension freedom reforms having made it easier for savers to pass on their pension pot to nominated individuals after death, two thirds (67%) of couples have never discussed their finances with their wider family.
Kirsty Anderson, retirement income expert at Prudential, said: “Keeping quiet about financial planning for the future can impact retirement income in many ways.”
“Most couples, whether they’re just starting out with their planning for the future or whether they’re in the run up to retirement, will benefit hugely from a joint consultation with a professional financial adviser about their pension saving and retirement income options,” she added.
What is Social Security? Social Security in the United States refers to the (OASDI) program, Old-Age, Survivors, and Disability Insurance, which is the overall program that supports the following initiatives:What is Social Security?
Federal Old-Age, Survivors, and Disability Insurance
Unemployment benefits
Temporary Assistance for Needy Families
Health Insurance for Aged and Disabled (Medicare)
Grants to States for Medical Assistance Programs (Medicaid)
State Children’s Health Insurance Program (SCHIP)
Supplemental Security Income (SSI)
Social Security is a social insurance program funded through dedicated payroll taxes called Federal Insurance Contributions Act (FICA). Tax deposits are formally entrusted to Federal Old-Age and Survivors Insurance Trust Fund, or Federal Disability Insurance Trust Fund, Federal Hospital Insurance Trust Fund or the Federal Supplementary Medical Insurance Trust Fund. The main part of the program is sometimes abbreviated OASDI (Old Age, Survivors, and Disability Insurance) or RSDI (Retirement, Survivors, and Disability Insurance).
Senior.com is the preeminent resource for information, products, and services focused on meeting the needs of seniors and those serving seniors in our communities. As the name suggests, we are only about seniors. As senior.com grows and expands in its offerings and its visitors, we will seek to provide the most up-to-date, accurate and informative content available today.
The mission of Senior.com is to provide an environment where our members and visitors can communicate with family and friends, research information relevant to their daily lives, share stories and experiences and purchase products and services safely. The vision of our website is to reflect the interests and lifestyle of our unique audience. In addition to catering to our members, Senior.com provides important information that can be helpful to family members and caregivers. We strive to anticipate the needs and desires of our audience in order to provide a comprehensive portal for people ages 50 and above.
Tax Scam Consumer Alert Seniors and consumers watch out! Tax scams are on the rise. We heard from several clients that received calls from fraudsters posing as IRS tax collectors asking for immediate payment or face immediate consequences. One of our elderly clients was very frantic, nervous and scared when she received this scam call. She really thought she needed to make a payment over the phone. We’re just thankful she thought to called us first before she did something she would regret later. Tax Scam Consumer Alert
Below is additional information about this phone scam that was taken directly from the IRS website under Tax Scam/Consumer Alerts. It’s almost never a good practice to give your personal information like social security numbers and credits cards over the telephone.
Please read! IRS-Impersonation Telephone Scam
An aggressive and sophisticated phone scam targeting taxpayers, including recent immigrants, has been making the rounds throughout the country. Callers claim to be employees of the IRS, but are not. These con artists can sound convincing when they call. They use fake names and bogus IRS identification badge numbers. They may know a lot about their targets, and they usually alter the caller ID to make it look like the IRS is calling.
Victims are told they owe money to the IRS and it must be paid promptly through a pre-loaded debit card or wire transfer. If the victim refuses to cooperate, they are then threatened with arrest, deportation or suspension of a business or driver’s license. In many cases, the caller becomes hostile and insulting. Or, victims may be told they have a refund due to try to trick them into sharing private information. If the phone isn’t answered, the scammers often leave an “urgent” callback request. Note that the IRS will never:
1) call to demand immediate payment, nor will the agency call about taxes owed without first having mailed you a bill;
2) demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe;
3) require you to use a specific payment method for your taxes, such as a prepaid debit card;
4) ask for credit or debit card numbers over the phone; or
5) threaten to bring in local police or other law-enforcement groups to have you arrested for not paying.
HARMON KONG, CFP®, Chief Wealth Manager, Principal
www.Apriem.com
What is Cybersecurity? Most refer Cybersecurity as technology security or in other words protecting your computers or data from unauthorized access, change or destruction.
Most of us at one point in our lives have been a victim or know someone who has been violated by a “hacker” trying to use our personal and confidential information for their own profit or use. If you turn on the news or read periodicals on any given day you will hear or read about financial institutions, retail institutions, government departments, hospitals, schools and airlines that are being compromised. It is uncomfortable to think that on a daily basis thousands of people across the globe sit at their computers trying to hack into our private data. In 2015 the number of mobile users and data networks is increasing everyday which also increase the opportunities for exploitation. The risk for being cyber attacked will continue to rise as the technology age is evolving rapidly. Some tips to protect you:
Be aware that hackers are out there and never take for granted you will not be affected.
Educate yourself on Cybersecurity.
Never click on links to emails if you do not know who it is from. Always be suspicious of links attached to emails.
Never open attachments from emails that you are not expecting. Turn off the option to automatically download attachments on your email.
Do not give out personal information over the phone, email or text messaging. i.e. social security number, addresses, driver’s license numbers, account numbers.
Set secure passwords on computers, mobile devices, iPads/Tablets. Change your password frequently and use a combination characters, numbers and symbols that are not common.
Use anti-virus software on your computers and keep that software updated.
Pay attention to your received emails. Hackers will usually change one letter to an email you are familiar with, making you think it is someone you know. If you are not sure, delete the email anyway. Better safe than sorry!
The Essence of Estate Planning Since none of us know the exact day and time we will die, time is the essence of a good estate plan. The Essence of Estate Planning
Having a good estate plan requires the self-realization that we will not live forever. So given this fact, ask yourself “What will happen to all of my stuff, and who is going to take care of my overall well-being if I am not able?” As you ponder this thought, either a sense of angst or peace will follow. If you have angst then you probably need to do an evaluation of your current estate plan.
1. “Just do it!” as the popular shoe company would say. Creating a well thought out estate plan can be overwhelming and like most overwhelming tasks in life, it’s easy to procrastinate. The hard truth is that the absence of a plan will put loved ones in a very burdensome reality. The basic estate planning documents include a Living Trust, Wills, Power of Attorney, and Health Care Directives. In the event of death or incapacity without these documents, the state will step in and begin a probate proceeding or a conservatorship. These proceedings are costly, time consuming, and stressful for the family.
2. Funding the trust as is important as drafting the trust document itself. A trust is ineffective if your assets (property and investment accounts) are not titled in the name of the trust. This is a common mistake made by many so it’s important to make sure all your assets are titled correctly.
3. Conduct a review of your retirement accounts and life insurance policies to make sure that your primary and contingent beneficiaries are named properly. Play out differing scenarios to make sure that you understand exactly how these assets will be treated both from a succession plan and a tax planning perspective. Doing so could save the family from additional stress and unnecessary taxes.
4. Death is not the only reason to create a plan. An unexpected or long term disability can have a bigger impact on your personal and financial affairs. Prepare for who might raise your children, who will handle your finances, and who will make health care decisions if you were to become incompetent or disabled. You can do this by having a Health Care Directive and proper Durable Power of Attorneys in place.
5. In naming your successor trustees, it is important to make sure that they are trustworthy, capable, and willing to help. For example, you should place control of your assets in the hands of a person who is financially healthy themselves and has an understanding of the roles and responsibilities of a successor trustee. If you cannot determine a competent individual successor trustee, it may make sense to name a corporate trustee to assume the role of trustee after you pass.
6. Planning ahead will help ensure that your estate tax exemption amount will be fully utilized to your advantage. Under the current estate tax law for 2015, each individual can pass on up to $5.43 million dollars of assets to their heirs, estate tax free. Amounts in excess of this can be subject to taxation of approximately 40%.
7. Tax law as well as personal circumstances change. It’s important to review your plan periodically for potential changes with a competent estate attorney or advisor that has expertise in this area.
These are just some topics to be aware of. Other topics might come up and being proactive and partnering with a good financial planner can ensure that you are well-informed and well-prepared. Apriem Advisors have financial planners on staff who can help you.
BILL PUGH, CFP®, AAMS, Wealth Manager
Apriem.com
Tired of reading review after review about 0% APR intro rate credit cards? Having no luck when it comes to finding an all-in-one-review about 0% APR intro rate credit cards? Confused with what you’ve read so far about 0% APR intro rate credit cards because everything seems to be contradictory? Well, look no more because this article is indeed what you’re looking for. Everything About 0% Intro Rate Credit Cards
In this article you will learn everything you want to know about 0% APR intro rate credit cards. You may also discover more than you bargained about 0% APR intro rate credit cards – in a good way, of course. Ready for Lesson Number One about 0% APR intro rate credit cards? Well, here goes.
It’s True – Yes, 0% APR intro rate credit cards do exist and if we have our way about it, you’ll be one of the lucky people to qualify for a 0% APR intro rate credit cards.
The Application Process – Applying for any credit card, whether it’s for 0% APR intro rate credit cards or for credit cards offering reward points is always a tad difficult so don’t expect overnight success, especially since you’re angling for 0% APR intro rates.
The application process for a 0% APR intro rate credit card starts with submitting the necessary documents – this is SOP for all credit card applications – that would substantiate your contact details and give them an overview about your present financial status. Upon submission of the usual documents, depending on your income level and credit reputation, you may be contacted by the credit company and asked to submit additional documents.
The Qualifications for 0% APR intro rate credit cards – Basically, if you want to have 0% APR intro rate, you must have a squeaky clean credit reputation. That means having a reputation of paying debts promptly, not owing too much from the bank, not having high balances on your other credit cards, not having too much mortgages under your name and not having so many people requiring a credit check on you.
If you’re not sure whether you qualify for a 0% APR intro rate credit card, simply approach the nearest credit bureau and request for a copy of your credit report. The details in your credit report can easily tell you if you’ve a good shot of owning a 0% APR intro rate credit card or not. People with FICO scores equal to 650 or more are more or less guaranteed of having their application approved.