What you all think of this idea .. At retirement build a semi tax free ladder of CD's and FA's with the cash you have to bridge your living expenses with social security until you turn 72. You only pay taxes on the interest made. Most likely well under the 35k limit. My case that might be a 5 year ladder with new rungs each year I draw on the current mature CD or FA ; out to the 9th year. This allows your IRA's , 401's that can be rolled into another fund to grow for 10 years before even being touched. At 72 you have to start taking distributions anyway from IRA's and 401 plans that are most likely taxed as income anyway. I get 10 years of basically tax free living...
Better investments than CDs out there, but the conceptual ladder approach works. And you can hold out to 72 for RMD, provided you were younger than 70.5 prior to 2020. Deferring distribution of most Iras and other retirement plans as long as you can, great to continue to build wealth. Your risk tolerance and thus your investments will change as you age...
Just trying to figure out the risk of the unkñowns is a big gamble.. holding onto your wealth in these times is a challenge to say the least... Im gonna eror on the conservative side right now and adjust as things change...
Not sure what you're looking for...diversification is still clutch, build wealth for retirement is key. My investments and mix have changed this year... lost a bit on some investments and more in cash/cash equivelents; high quality bonds and some industries/funds. From an economics perspective, its up/down day to day (today we're up). IMHO - I don't think we've hit bottom.
Yeah, bottom is probably still another 6-9 months out....right after I retire.... What sucks is that I have some money in accounts that are "plan" only. And I just made notice of that recently. Oh ****! I won't be able to keep them there after retirement.
Some investments (mutfunds, etfs, etc) you can find similar options available, though maybe different (share) classes... Proprietary investments (certain annuities, funds/investments your company may manage/own) you are SOL, but you may be able to determine something similar based on any prospectus/info offered. I have some plan only that I'm over a certain $ threshold, so I left it in the plan. I'm probably going to consolidate some, to someone like Schwab, Fidelity, etc via a direct rollover...
Our company plan is now with Fidelity. Switched from Wells Fargo a few years ago. WF sucked. Pretty sure I'm going to stick with Fidelity. Just need to start the conversation with them and see what they offer. Like i said, the funds that were my employers plan is going to be painful wether i retire on my own next year or i get RIFed before then.
Your "plan only" investments often have higher hidden fees than you should be paying. They don't necessarily disclose the fee, but they hide it in the NAV that is calculated daily. Many times your plan will charge more in fees after you retire and stop contributions also. It's always best to find a fiduciary Adviser that can take a deep dive into those options. Many of them will do that for free or a minimal fee. There are a lot of good asset management firms that can custom tailor a plan for you and you will have a chance at better outcome and still be paying less in fees.
So just said eff it, and bumped it up to 20% for both salary and bonus, I had since bumped it up to 17%. Still unsure if I'll have enough time in for a bonus this year but glad they have them separated for contributing. Figure best to do it now before I readjust to a new budget that is steady. I can easily change the bonus portion each year. Get a smaller mid year bonus and the larger year end. If I can stay mosty debt free I may be able to get to max contributions afterall, at least some years which is better than none. Need to look into an IRA as well.
Like I've told my kids, put as much as you can in retirement savings to start (no less than the max an employer may offer to match). Up the contribution as you get raises/promotions/bonuses. You want to hit the limit allowed by tax, as soon as you can. IMHO paying off debt is next. Then, if you can put aside other $ do so. My employers have offered stock purchase plans, at 10-15% below closing, which has been more useful for me than $ locked in an IRA. But a decision you need to make. Congrats on the promo BTW!
Bumpity bump..... My question now is.... How do you determine if you're on pace to be in good shape? Taxes will never be lower, I have 15-20 years left before retirement age, does it change again before then? Most likely. Stressing on this lately for some reason
IMHO taxes will need to rise in the coming decades. So use of both a Roth and pretax helps mitigate and gives you some choices when you retire. All kinds of tools and services out there to tell you you're on /of track. Many really just want to manage your portfolio of all you some stupid investment so be careful. I've seen estimates that range from 1-3m needed for retirement. It really depends on your lifestyle, and costs where you live ( or plan to live). Think about saving enough to live (mostly) off the returns. I figure, if I over saved, my heir will have a windfall. You're costs may be lower for some things (e.g. Paid off the mortgage) but others higher (insurance, food, fuel, taxes, etc). You can swag a budget, inflation and actuarial tables to swag what it would cost over your calculated life span...and work backward. E.g if your need to save for 25 yrs, need 100k per year and only save 1m, you're probably screwed, unless you know you can get consistent 10% returns. Also assuming you're gonna get returns of 10-15% are overly optimistic, as the past couple years remind us...
