The earlier you start planning for retirement the brighter your golden years will be. You will not always be able to work like you can today. Unless you save now, you may not have the money you need for the necessities of life or for fun. If your company provides a retirement fund, like that of JC Penney retirees, it is helpful, but ultimately you are in control of your future.
Work with your planner to determine your retirement funding needs. To continue your current standard of living you will need at least 70 percent of the income you currently make. If you are among the lower earners, saving is even more difficult, yet planners believe you will need 90 percent or more of your current income when you stop working.
If a retirement savings plan is available through your current employer, enroll. These plans help to lower your tax burden and increase your refunds. Additionally, they often come as an automatic deduction so it is easier to save. If your company contributes matching funds, it is like getting a raise for each dollar saved. Find the maximum amount of matching funds and the length of time you must work to be fully vested with matching funds.
The type of savings is often as important as the amount. Money should be invested in different types of accounts and never in just one. Diversifying reduces risk while improving return and providing more funds for retirement.
Avoid the temptation to withdraw money from retirement accounts. You lose both principal and interest in doing so. In many cases, you also face penalties that further reduce savings and your tax benefit. Even borrowing against one's retirement savings puts these funds at risk as you would lose the funds and tax advantages if you default.
If you change jobs, leave the savings at the old job if possible. If you must move them be sure to meet the required time limitations for reinvesting. This helps to avoid penalties.
Work with your planner to determine your retirement funding needs. To continue your current standard of living you will need at least 70 percent of the income you currently make. If you are among the lower earners, saving is even more difficult, yet planners believe you will need 90 percent or more of your current income when you stop working.
If a retirement savings plan is available through your current employer, enroll. These plans help to lower your tax burden and increase your refunds. Additionally, they often come as an automatic deduction so it is easier to save. If your company contributes matching funds, it is like getting a raise for each dollar saved. Find the maximum amount of matching funds and the length of time you must work to be fully vested with matching funds.
The type of savings is often as important as the amount. Money should be invested in different types of accounts and never in just one. Diversifying reduces risk while improving return and providing more funds for retirement.
Avoid the temptation to withdraw money from retirement accounts. You lose both principal and interest in doing so. In many cases, you also face penalties that further reduce savings and your tax benefit. Even borrowing against one's retirement savings puts these funds at risk as you would lose the funds and tax advantages if you default.
If you change jobs, leave the savings at the old job if possible. If you must move them be sure to meet the required time limitations for reinvesting. This helps to avoid penalties.
About the Author:
JC Penney retirees, find an overview of the reasons why you should consult an investment adviser and more information about an experienced adviser at http://www.personal-investments.net/ now.
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