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.
Start working with the planner early to determine your funding needs for today. Continuing at your current standard of living often requires at least 70 percent of your current income. If you work a lower income job, savings can be more difficult, but it is likely you will require 90 percent or even more of your current income in order to stop working.
If your employer has a retirement savings plan, you should participate. The plan lowers your taxes, which can increase your refund each year. In addition, the automatic deductions make saving easier. If your company adds to your savings, you get even more for each dollar saved. Check with the employer to find the maximum they will contribute and the number of years you must participate to collect the 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.
Leave the savings in the same plan if you change jobs. Some employers do not allow you to leave retirement in the plan if you leave the job. Move them to an approved plan within the required time. You will avoid penalties.
Start working with the planner early to determine your funding needs for today. Continuing at your current standard of living often requires at least 70 percent of your current income. If you work a lower income job, savings can be more difficult, but it is likely you will require 90 percent or even more of your current income in order to stop working.
If your employer has a retirement savings plan, you should participate. The plan lowers your taxes, which can increase your refund each year. In addition, the automatic deductions make saving easier. If your company adds to your savings, you get even more for each dollar saved. Check with the employer to find the maximum they will contribute and the number of years you must participate to collect the 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.
Leave the savings in the same plan if you change jobs. Some employers do not allow you to leave retirement in the plan if you leave the job. Move them to an approved plan within the required time. You will 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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