Why the 80% Rule for Retirement Income is Mostly Wrong.
Wise Money Retirement
One of the primary goals of retirement planning is to figure out how to use your retirement assets in the best way to generate the income you’ll need after you stop working. But to do this, it is important to have a pretty good idea as to the amount of income you’ll actually need. Estimating this is not a simple matter because there are so many things to consider. How much income will you need to pay your bills and essential living expenses? What amount do you want to spend for travel, pursuing hobbies and living your retirement dreams? How might your needs for income change over time as...
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Safe Ways to Balance Risk and Reward for more Retirement Income
Wise Money Retirement
There is a very definite and unbreakable connection between risk and reward. Choose a financial instrument that helps provide greater potential returns, and you inevitably increase the degree that your money will be subject to investment loss. If instead you chose safety and protection over growth, expect the compromise of lower rates of return. Many retirees become frustrated as they search for the “perfect” investment that breaks this rigid risk and reward connection. Any time you hear of people getting taken advantage of and becoming the targets of fraud and financial abuse, it is...
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4 Steps to a Better Retirement Plan
Wise Money Retirement
4 Steps to a Better Retirement Plan Do you have your retirement date set, or have you already retired? And how about your financial plan…. Do you have things squared away? Or are you still working on putting all the pieces together? Creating a financial plan for retirement can be a tough job. There are a lot of moving parts and a ton of uncertainty that you’ll have to consider. We want to help you with some easy tips that you can follow to create a better retirement plan. These 4 areas of retirement planning are all areas that we see a certain level of misunderstanding. When we consult...
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Strategic Roth IRA Conversions
Wise Money Retirement
Converting to a Roth IRA might be a key to help your retirement dollars last longer.
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Don't Out Live Your Money With These Helpful Tips
Wise Money Retirement
Tips for Making Sure You Won’t Outlive Your Money.
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Social Security Millionaire
Wise Money Retirement
Maximize your future Social Security benefits to enjoy a more confident retirement.
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How to have a "Tax Wise" Retirement
Wise Money Retirement
It’s not how much income you have, but how much is left to spend.
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3 Essential Elements to a Successful Retirement Plan
Wise Money Retirement
Make sure that you have a plan that addresses these three key areas of retirement planning.
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Could Your Financial Behaviors Wreck Your retirement?
Wise Money Retirement
Could Your Financial Behaviors Wreck Your retirement? In recent years, there has been a huge push in the field of “behavioral finance.” That is, what types of behaviors do people that can affect one’s portfolio. That’s what we are going to talk about on the today’s show. We're going to discuss if it's possible that your financial behaviors could affect your retirement. To dive in deeper we’ve outlined 4 biases people tend to run into! More specifically, the bad behaviors that could impact your financial life. Believe it or not, science has shown there are certain human...
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6 Common Retirement Misconceptions
Wise Money Retirement
6 Common Retirement Misconceptions Planning for major life events can be very exciting, but it can also be very stressful. These types of events should require some deep thought and a thorough planning process. Some people enjoy the planning process and take the time to do so, while others do not spend as much time preparing. It is important to plan properly in order to be successful. Today, we want to discuss the importance of retirement planning, and how to avoid the common misconceptions many people make while planning for retirement. Misconceptions are common in every area of life, and...
info_outlineStrategic Roth IRA Conversion
How would you like to switch your retirement savings to an account that grows tax-free? You can make tax-free withdrawals from the account. And you can leave a tax-free inheritance to your heirs. Right now, there are no restrictions on converting to this tax-free oasis. So, if you're considering a Roth IRA conversion you are going to want to think taxes.
Like most people, your taxable income is fixed and tied directly to your paychecks. However, the day you retire those paychecks end. But, the degree of control you may have over your tax may improve. Now you can manage the amount of income you will have to report to Uncle Sam. You'll have control other things that determine your taxable income. It’s pretty much up to you as to how much money you withdraw each year from your retirement accounts.
How to Decide?
You decide if you want to start your Social Security benefits as early as age 62, or delay those benefits, and any associated taxes they might trigger. It’s entirely up to you as to when you might sell any stocks in your brokerage account, taxed at lower capital gains tax rate, if you want more income. Best of all, if you have some money in a Roth IRA, by now you may have fulfilled the requirements allowing you to take withdrawals … entirely free from income taxes. Any income that is tax-free will surely bring a tear to Uncle Sam’s eye.
Don’t have a Roth IRA? It may not be too late. In fact, those first five or so years after you stop working may be a great opportunity to convert some of the money in your taxable retirement accounts to a tax-free Roth. One very important thing to consider is that you’ll have to pay tax on the money you convert. There’s no free lunch here. Every tax dollar you are forced to pay now because of any conversion will certainly be painful, but just remember that paying this tax today could save you or your heirs many more tax dollars in the future.
However, the day you retire and those paychecks end, the degree of control you may have over your taxes might improve dramatically. It’s a great time for some advance planning because now you can better manage the amount of income you will have to report to Uncle Sam each time April 15th rolls around. You have control other many things that determine your taxable income. It’s pretty much up to you as to how much money you withdraw each year from your retirement accounts. You decide if you want to start your Social Security benefits as early as age 62, or delay those benefits, and any associated taxes they might trigger. It’s entirely up to you as to when you might sell any stocks in your brokerage account, taxed at lower capital gains tax rate, if you want more income. Best of all, if you have some money in a Roth IRA, by now you may have fulfilled the requirements allowing you to take withdrawals … entirely free from income taxes. Any income that is tax-free will surely bring a tear to Uncle Sam’s eye.
Don’t have a Roth IRA? It may not be too late. In fact, those first five or so years after you stop working may be a great opportunity to convert some of the money in your taxable retirement accounts to a tax-free Roth.