Planning For Retirement

50 %
50 %
Information about Planning For Retirement

Published on February 19, 2014

Author: afinpro


Planning for Retirement Don’t just wish for it. Plan for it.

Potential obstacles  Disappearing pension plans  The future of Social Security  Health care costs  Inflation  Taxes  Outliving your retirement savings

You could outlive your savings At age 65 50% chance 25% chance of living to: of living to: Single man Age 85 Age 92 Single woman Age 88 Age 94 Married couple (at least one spouse) Age 92 Age 97 Source: Annuity 2000 Mortality Table, Society of Actuaries

The road to retirement  Pay yourself first  Spend less now, have more later  Minimize debt  Save for long-term goals

Don’t wait $100,000 $75,000 $83,572 Contributing $100 a month If you start today If you wait three years $50,000 $68,603 $41,274 $32,186 $25,000 $6,828 $15,592 $10,074 $2,529 $0 In 5 years In 10 years In 20 years In 30 years Assumptions: (1) Contribute $100 at the beginning of each month. (2) Earn a 5 percent annualized rate of return. This hypothetical example is not intended to illustrate the performance of any Modern Woodmen annuity.

Don’t wait $125,000 $105,123 $104,157 $100,000 Contributions Account balance at age 60 $75,000 $60,000 $50,000 $30,000 $25,000 $0 Age 30 $3,000 for 10 years Age 40 $3,000 for 20 years Assumptions: (1) Contribute $3,000 at the beginning of each year. (2) Earn a 5 percent annualized rate of return. This hypothetical example is not intended to illustrate the performance of any Modern Woodmen annuity.

Benefits of tax-deferred growth $150,000 $125,000 Tax-deferred account – $139,521.58 Taxable account – $111,633.42 $100,000 $75,000 $50,000 $25,000 $0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Assumptions: (1) Contribute $2,000 at the beginning of the year for 30 years. (2) Earn a 5 percent annualized rate of return for 30 years. (3) 25 percent effective income tax rate. This hypothetical example is not intended to illustrate the performance of any retirement option.

Potential solutions Option Benefit 401(k), 403(b), 457(b) and Pretax contributions SIMPLE IRA plans Traditional IRA Potential income tax deduction Roth IRA Potential for income tax-free withdrawals Annuities Guaranteed income options

It’s not too late to catch up Plan Basic contribution limit Additional catch-up contribution 401(k), 403(b), 457(b) and employee deferrals $16,500 $5,500 Traditional and Roth IRAs $5,000 $1,000 SIMPLE IRA $11,500 $2,500 Catch-up contributions are allowed for those who turn age 50 or older by year-end.

Don’t cash out! What should I do with my old plan? $150,000 $132,664 in 20 years $50,000 401(k) $100,000 $50,000 $30,000 now $0 Take cash now Rollover IRA Assumptions: (1) $50,000 rollover from a 401(k) plan to a Traditional IRA earning a 5 percent annualized rate of return for 20 years. (2) A 40 percent effective income tax rate is applied to taking cash now (25 percent federal income tax plus 10 percent federal penalty plus 5 percent state income tax). This hypothetical example is not intended to illustrate the performance of any Modern Woodmen annuity or the income tax rates for a particular individual. Income taxes must be paid on any amount withdrawn. Some states may impose additional penalties.

Retirement income – the big picture  Create a paycheck for life, don’t outlive your money  Be aware of inflation  Have savings for a rainy day  Manage risks  Protect income against market volatility

Retirement income options  Occasional partial withdrawals  Automatic withdrawals  Withdrawal of interest  Guaranteed income payments for a certain time period (for annuities only)  Guaranteed income payments for life (for annuities only)

Put it all together  Pay yourself first and save for retirement  Protect your retirement savings  Know your retirement income options  Work with someone who can help

Modern Woodmen can help  Don’t just wish for a good retirement. Plan for it.  Let us help. Steve Baker (615) 669-0539 Securities offered through MWA Financial Services Inc., a wholly owned subsidiary of Modern Woodmen of America, 1701 1st Avenue, Rock Island, IL 61201, 309-558-3100. Member: FINRA, SIPC. Products are available in most states. Individual representatives may not be licensed to sell all products. Tax issues are complex. Please consult a tax professional before making a decision.

Add a comment

Related presentations

Les changements sur le marché du distressed aux Etats-Unis et en Europe

Main Sections of the Report 1) Nifty Technical View 2) 4 Large Cap Trade Ide...

This presentation consits the yearly results of Kinepolis Group

Related pages

RETIREMENT PLANNING: How much to save for retirement - May ...

How much to save in retirement: To live well in retirement, you no longer can rely solely on a company pension plan or Social Security. Instead, you will ...
Read more

Top 10 Ways to Prepare for Retirement - U.S. Department of ...

Printer Friendly Version | en español. Financial security in retirement doesn’t just happen. It takes planning and commitment and, yes, money.
Read more

Retirement Planner: Plan For Your Retirement

A secure, comfortable retirement is every worker's dream. And now because we're living longer, healthier lives, we can expect to spend more time in ...
Read more

Retirement Planning and Savings Plans - Retirement ...

Retirement planning strategies and retirement advice, including retirement calculators to help you retire faster, 401k tips and more.
Read more

Planning for retirement | Age UK

Retirement. When you approach or reach retirement, there are a whole host of issues to look at. Let us help you prepare. Planning for retirement
Read more

Retirement Planning - IRAs, Guidance & Tools - Fidelity

Fidelity can help guide you along the path of retirement planning. No matter where you are in life, we can provide guidance, tools, and services to help ...
Read more

Retirement Planning - Financial Planning for Retirement ...

Financial Planning for Retirement - MarketWatch offers advice for retirement planning including articles on 401K retirement plans and investing.
Read more

The 5 Biggest Retirement Planning Mistakes You Can Avoid

One of the biggest dilemmas for those approaching retirement is balancing the life they want to live today with the life they want to live in ...
Read more

Retirement planning | Money | The Guardian

Retirement planning November 2015. Your problems with Anna Tims I am being forced to pay twice for the same pension pot advice. Published: 18 Nov 2015
Read more

Planning For Retirement: Pictures, Videos, Breaking News

Big News on Planning For Retirement. Includes blogs, news, and community conversations about Planning For Retirement.
Read more