All About Retirement Planning and Life Insurance

Update Sept. 08- 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-09-06T07:55:00.000-07:00

It does not occur to us when we are young and carefree professionals that life will not be as fast someday, because you will not be so. While today we are capable of working sixteen out of twenty four hours, someday we might find ourselves struggling to cope with even ten. It is inevitable that you will age, and it is inexorable that you will want or be forced to retire. So what have you been doing to plan for this event? Only waiting to be at the mercy of the saving accounts of 401 k planning?

But the first question is do you know enough about pension retirement planning at all. Pension, superannuation, and retirement plans, all are synonymous and interchangeable words. While the word mostly used in US is retirement plans, UK and Ireland calls theirs as pension schemes, and Australia and New Zealand address it as superannuation plans.

All of these make provisions to give to people a controlled regular income even after they stop working. Mostly the pension plan is taken care of by the company which employs you. They maintain a savings account of 401k planning, which also defers taxes. Such a pension is known as employer or occupational pension and the retirement income is of deferred compensation type. It may or may not have a component of life insurance or severance pay. In severance pay though, all the amount of saving is paid at one go, in a lump sum, unlike retirement income. Thus, one can say that your retirement planning is actually like a long term care insurance.

Pension retirement plans are also provided for by Labour Unions, government and sometimes also lotteries. Social Security is one of the retirement planning funds maintained by the State for maintaining its aging citizens. In it also, one will have to keep contributing some amount towards your retirement income. Depending on the record of your contribution history, your pension retirement shall be decided.

If we overlook the ownership of the pension fund, then we can divide retirement planning methods into broadly two main categories; defined benefit and defined contribution.

As the name suggests, both have one component. Either the benefit or the contribution is more clearly chalked out, while the rest may or may not be as certain and quantifiable. So in defined benefit, you know the exact sum of your retirement income that you would get. While in defined contribution, the pension retirement money which comes to you eventually varies. Its basis is the choices of investment into stocks or mutual funds etc that you made while you were contributing.

To give you best of both the worlds, you have a special retirement plan called Cash balance. Due to their dual features, they are also called as hybrid plans.

It is important that while retirement planning, for women or men, one must understand how the scheme of things work and what have been their shortcomings over the years, which then you can watch out for.

So plan well and have a relaxed retirement.

Visit http://www.annuitycampus.com for more Annuity and Life Insurance Tips and Tricks.

Call Robert Eldridge directly at 800-643-7544.

Robert Eldridge holds over a decade of experience as a multiline agent in multiple states and currently serves on the membership council of the National Association of Insurance and Financial Advisors.

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Update Auguse 23 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-08-22T08:37:00.000-07:00

If you're over 60, you're probably familiar with the traditional "Three Legged Stool" model of saving for retirement; SOCIAL SECURITY, PENSIONS, SAVINGS. You may have used this method in planning your retirement income. Well don't get too comfortable - the stool's broken! If you've watched the news much lately, I'm sure you're aware of the the challenges facing us. In this post we'll look at the problems you WILL be facing and then a solution to securing your retirement savings.

PROBLEM #1 SOCIAL SECURITY:

Have you looked at your Social Security statement lately? When you do, read the first page very carefully. Pay close attention to the first paragraph of the second column.

In 2016, the Social Security Administration will begin paying more in benefits than they collect in taxes. Were you aware that without changes, the Social Security Trust Fund will be exhausted by 2037 and there will be enough money to pay only about 76 cents for each dollar of scheduled benefits? Probably not. Even more shocking recent news reports state that the Social Security Administration will pay more in benefits than they collect in taxes in 2010! That puts us 6 years ahead of the government's 2016 prediction. A recent article on this from the New York Times can be found at the link at the end of this article.

Social security is currently the largest social welfare program in the U.S., constituting 37% of government expenditure and 7% of GDP. It was created in 1935 as a part of the signing of the New Deal. Many people don't realize that the average life expectancy in the U.S. was less than 62 years old when social security was created in 1935. The government never planned on having more than 50 million Americans to provide retirement income for, and that number is only going to continue to grow with the baby boomers now reaching retirement age. It was meant to be a supplement to retirement, not the main course. Don't put your head in the sand hoping this problem goes away - IT WONT! Start doing some planning now.

PROBLEM #2 PENSIONS:

I hear it all the time, "I don't have to worry I've got a state pension." I hope this isn't you. Pensions aren't what they used to be. Most state pensions are woefully underfunded.

We all know private plans have failed left and right, and many more companies have just discontinued their plans without much warning and to add insult to injury, the Pension Benefit Guaranty Corporation - the government backup for failed plans - is massively underfunded by billions and billions of dollars. Now, even state and local government plans are at risk of collapse.

In fact, a recent study conducted by Joshua Rauh of Northwestern University basically said 45 out of 50 state pension plans were at risk of failing in the next 10 to 20 years! Will yours be one of them? What if it is? How will you recover the income. This problem isn't going away. Do some planning now!

PROBLEM #3 SAVINGS:

Here are some scary statistics:

* One-half of American households have accumulated less than $1,000 in net financial assets and $35,000 in net wealth.

* Consumer debt (SPENDING) is a significant reason for low net financial assets.

* The one-fifth of households with the lowest financial assets held, by far, the highest consumer debts, most of them unsecured (mainly credit card debt).

* A majority of Americans in households with incomes of $35,000 or less believed that they are more likely to accumulate a $500,000 nest egg by winning a lottery or sweepstakes (40%) than by patient saving and investing of relatively modest sums (30%).

Do you fall into one of these categories? Do you know if your income will last and how much you'd have? This calculator may help. It allows you to input your financial numbers and look at different outcomes. I also have a new program called "Booming Income" that is available for you to configure income for life tailored just for you.

BONUS PROBLEM #4 INFLATION:

As if those weren't enough problems to keep you busy trying to plug the dike, you have to consider inflation. Right now with all the bailouts, printing money, reducing interest rates to zero etc, inflation has not reared it's ugly head.....YET! Rest assured it will. The Feds can't sustain the money manufacturing indefinitely and when the flow becomes a drip watch out.

Right now inflation is only running between 1-2.5%. Do you know the highest inflation rate on record? In 1979 it climbed to a breath taking 13.9%. If that happened again, how long would your savings last? If you can't answer that, you may want to take advantage of my free consultation.

SOLUTIONS:

Here's just a few ideas:

* For the younger, don't get caught in the government pre-packaged savings plans; 401k, IRA's etc. Life Insurance is a better option. (more info on this at "Let's Talk Retirement")

* Use an annuity "bucket" method to create income now with one "bucket" set aside to grow for future income.

* Put a portion of your nest egg in a Fixed INDEXED Annuity to allow for growth indexed to the market with NO LOSS guaranteed.

* Add an income rider to the FIA to let the money grow in a side fund at 7.2-8% for income. This allows the asset to double every 8-10 years.

* Move money into tax deferred annuities to reduce or eliminate taxes on social security & brokerage accounts.

* There's much more you could do.

IN CONCLUSION:

Listen, there's a lot of things to worry about these days; your income doesn't need to be one of them. You just need to take the time to do some planning so you know what needs to be done. I have new products that will immediately add 8-10% to your existing funds and give you 8% guaranteed compounded interest for income. Why would you "Park" your money at 1-2% in money market or CD's when there are these kinds of options that will still give you access, use and control of your funds? If what you knew to be true about your future income turned out NOT to be true, when would YOU want to know about it? Don't wait another minute. CONTACT ME HERE and get some peace of mind.

(NY Times article: here.)

Roger Ely offers safe money retirement strategies to help maximize your and convert your retirement savings into retirement income guaranteed for life, provide for continued growth, help over come Long Term Care costs, and guarantee you Never Lose Another Dime! More information is available at http://letstalkretirement.com

Article Source: http://EzineArticles.com/?expert=Roger_H_Ely

Update Auguse 06 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-08-05T10:57:00.000-07:00

Retirement planning, in a financial context, refers to the allocation of finances for retirement. This normally means the setting aside of money or other assets to obtain a steady income at retirement. The goal of retirement planning is to achieve financial independence, so that the need to be gainfully employed is optional rather than a necessity.The process of retirement planning aims to:(1) assess readiness-to-retire given a desired retirement age and lifestyle, i.e. do you have sufficient money to retire; and(2) to identify actions to improve readiness-to-retire. (Contributed By en.wikipedia.org)

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How Rising Life Expectancy Makes Retirement Planning More Difficult
By Christopher Fitch

Life expectancy is an interesting statistic, but it takes on greater importance when planning for retirement. One of the things that most individuals fear as far as their hard-earned retirement savings go, is that they will outlive their savings. With this in mind, annuities offer a tremendous opportunity for investors to earn an income for the rest of their life (or a set time frame), regardless of how long they will life.
Knowing how long you will live in statistical terms is fairly unimportant. At birth, males have an average life expectancy of 75 years while female counterparts are expected to live five years longer to 80. Of course, with nearly each year of life one survives (or enjoys is probably the more human way of looking at things), life expectancy tends to increase. Although expected life expectancy increases are very subtle and completely unnoticeable on a year-to-year basis, they exist according to the same tables that annuity companies (mostly insurance companies) use.
With that in mind, someone planning their retirement at birth will might benefit from the tremendous impact of compounding by starting early, but would only need to plan to use those savings until the age of 75 or 80, depending on whether they are male or female. By the time that eager retirement saver reaches 55, their life expectancy has climbed to 79 and 82 (the higher number will always refer to females). This means planning to live to 75 or 80 is virtually useless.
But what about planning to live until you are 82 or 84? Again, this is all fine until one reaches 75, the age at which most males, at birth, are expected to die. At 75, life expectancy rises to 85 for men and 87 for women. And then at 85, just ten years later and ten years beyond the life expectancy for males (at birth), life expectancy jumps to 90 for men and 92 for women.
In other words, living long really is a feat for so many. But it can also become a financial nightmare if one has not saved with such a long and healthy life in mind. One of the strategies that an investor can use, which was mentioned earlier, is annuities. While such investment/insurance products indeed have their flaws, they certainly serve a tremendous purpose in that people who are worried about living longer than their savings can at the very least partially quell such fears with a life annuity (designed to last to death). For investors who are dead-set against such products, splitting their portfolio to allow a mix of income sources (one that incorporates a pension/annuity/both as well as regular investment income) seems to be a happy middle-ground.
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Chris has been writing online for over 4 years. He currently manages a website Elliptical Trainer Reviews at GymExerciseMachines.com, a website that currently has over 100 conversational fitness product reviews.
Article Source: http://EzineArticles.com/?expert=Christopher_Fitch

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Update July 20 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-07-19T11:33:00.000-07:00

Retirement planning, in a financial context, refers to the allocation of finances for retirement. This normally means the setting aside of money or other assets to obtain a steady income at retirement. The goal of retirement planning is to achieve financial independence, so that the need to be gainfully employed is optional rather than a necessity.The process of retirement planning aims to:
(1) assess readiness-to-retire given a desired retirement age and lifestyle, i.e. do you have sufficient money to retire; and
(2) to identify actions to improve readiness-to-retire. (Contributed By en.wikipedia.org)

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Early Retirement Planning - Retire to an RV
By Gary Pierce

If you could live on 50% of what you spend now in a house, living on an RV, would you do it?
Retiring to live on an RV is an option that potential retirees should explore. If you have had a smell of the open road and the freedom such a lifestyle affords, consider doing it full time.
Imagine the money you would save if you sold your house and used part of the equity to buy an RV. You do not have to spend all of your equity either. A $30,000 motor home can be next to a million dollar Prevost in the campground. You see the same scenery.
No property taxes; no massive utility bills; no lawn to mow; no snow to shovel; no house to paint; etc. I think you have the picture...life in an RV is a lot less stressful and time consuming than living in a house. In addition, it is cheaper.
If you have not seen all of the beautiful National Parks in America, it would make a noble goal to shoot for when retiring.
Another plus when retiring to life in an RV is the nice people you meet. You will find yourselves toasting each other on your good sense in retiring to this fun, frugal and fulfilling lifestyle.
We lived on our RV for 7 years; our other home was a sailboat in the Caribbean. We spent well less than 50% of what we spent living in a house...you should be able to live on 50% of your house expenses as a goal.
So if your early retirement planning does not include low cost lifestyles like living on an RV, check it out. You may discover you can retire much sooner than you thought. Now that would be a nice surprise. Enjoy.
Early retirement planning Gary Pierce is the webmaster of http://www.frugal-retirement-living.com he retired early at 49, he is still retired at 64. He has experience in lifestyles that are both fulfilling and frugal.. It is 2009 and many are wondering if they can ever retire. Don't give up until you check out this website. Enjoy.

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Update July 01 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-07-01T07:42:00.000-07:00

By Bill Broich

1. Not planning. Most Americans don't have a good idea of how much they need to save for retirement. Simple planning can help put in prospective how much money needed for retirement. Guess work is an error

2. Retiring to early without a solid plan in place. We all dream of retirement and spending our time as we see fit, but making that life changing decision prior without fully understanding the consequences can be an error. As early retirement could also mean assessing Social Security prior to receiving the maximum benefit. Once Social Security si selected, it cannot be changed. Working even a few years beyond what you've planned can pay a surprisingly large bonus in retirement security.

3. Not understanding life expectancy tables. More than 60% of Americans live longer than they expected. At age 65, a woman can expect to live to an average of 85 and a male about age 82. It is important to know that those estimates are based on averages and your actual personal life expectancy could be longer.

4. Job searching at an older age. Thinking that finding a part-time job or being able to reenter the work force later in life if income is needed is extremely difficult.

5. Not saving enough money. We have become a nation of spenders and not savers. Compared to other cultures and countries, The US lags behind in the percentage of funds saved. A recent government report showed the average U.S. household has managed to save just over $60,000 toward retirement. The average contribution to a working saving plan is 7.5 percent of salary, not enough to accomplish the needed future retirement goals.

6. Risk....Not understanding how risk can affect future results. Exposure to stocks is too great as retirement approaches and not reallocating to safety and security in a timely manner. About 1 in 3 investors approaching retirement age had more than 80 percent of their account balances in the wrong asset allocation according to a report completed in 2008. Exposure to unseen market trends which are out of most people's control can result in poor performance just as retirement approaches.

7. Premature use of qualified money. It is estimated that 45 percent of workplace retirement plan participants cash out their 401 (k) balances when they change jobs rather than roll them over to a new plan or to a self directed IRA. Taxes and fees can be a huge detriment to the retirement planning process.

8. Not understanding or ignoring annuities. Annuities are the only financial product available which can provide income for any time period, even lifetime. Not using these products can adversely affect the need for income over long period of time.

9. Health expense risk. Not adequately considering future health costs can have a major affect on retirement planning. Health costs have increased rapidly and not setting aside a percentage of retirement income can severely damage future needs.

10. Not being informed. Knowledge is everything when it comes to proper retirement planning. Make every opportunity to become as informed of your options as possible and always seek professional tax and legal advice. When a financial planner or agent makes a recommendation make certain a second opinion is sought. Be careful and be informed.

Want a financial product that is immune from a faltering economy? Want to protect your savings and retirement funds? Look at an annuity. Get a free annuity booklet from Annuity.com: Annuity Investing

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Update June 13 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-06-13T07:30:00.000-07:00

How Fixed Annuities Can Ruin Early Retirement

By D. Victor

Fixed annuities are an attractive investment option for those seeking to obtain stable returns on their investment with virtually no risk. However, when you plan to retire early, their advantage could easily transform into a handicap.

Early retirement is a double-edged sword. According to research conducted by the Life Insurance Marketing and Research Association (LIMRA), those who retire earlier tend to have a higher life expectancy. That is good news on one hand, but it also suggests that early retirees face a higher longevity risk. The conservative nature of fixed annuities can easily fetter the capital growth necessary to amass more retirement savings in a shorter period of time.

For those who plan to retire before the average retirement age, the relatively low returns offered by fixed annuities compound the difficulty of having a shorter investment horizon. When you have a shorter investment horizon, you need accelerated growth. Annuity providers did not design this product to provide that. A fixed annuity is slow, steady and reliable, but you cannot even hope that it will grow at a faster rate than the annuity provider stipulates.

Based on their higher life expectancy, early retirees are more exposed to inflation risk during retirement. The payout rate of fixed annuities is based on a number of factors. However, the most important characteristic is that fixed annuities have fixed payouts. The longer exposure to inflation after early retirement will erode your retirement income significantly, especially in the latter stages of your retirement.

Life annuities are one form of fixed annuities. Purchasing them (with the exception of straight life annuities) when you plan to retire early is not always advisable. This is because life annuities with insurance components generate less retirement income per premium dollar. Unless the insurance components add significant value to your financial plan, certain life annuities should be avoided once you plan to retire early.

That you plan an early retirement does not necessitate complete avoidance of FAs. Some fixed annuities can work for early retirees if used properly. You can either invest lump sums earlier in the accumulation phase or extend the accumulation phase well past your retirement date. With some annuity providers, the terms and conditions of fixed annuities are negotiable. This means that you may have the power to make a fixed annuity fit neatly into your early retirement plans.

A fixed annuity is only a retirement tool. When you plan an early retirement, this tool must be used more cautiously. Fixed annuities may not be the ideal financial instrument to finance all or even the majority of your retirement plans. However, in the context of a diversified retirement portfolio - they can help you to retire early without increasing the risk of outliving your retirement savings.

A major aspect of retirement planning is determining your income needs. Now, you can read a clear instructional guide on how to calculate your retirement needs: http://retirement.helium.com/how-to/9181-how-to-calculate-your-retirement-income-needs

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Update May 23 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-05-23T08:24:00.001-07:00

A Financial Education in Investing For Retirement

By James Leitz

Our educational system fails to teach financial education and as a result millions of Americans fail when dealing with financial matters. The recent collapse of real estate prices wiped out countless families who overextended themselves financially and ended up with their homes in foreclosure and a low credit score. In terms of investing for retirement, the average investor scores poorly as well.

The level of your financial education in the area of investing may very well determine the level of your financial security in retirement. In your working years you will likely invest in a retirement plan at work and/or in an IRA. Once retired, you have hopefully accumulated a retirement nest egg that can provide you with future income and financial security for life. All along the way financial education is important, because you will be making investment decisions on an ongoing basis.

Start your education in the investment area by focusing on mutual funds. These investment packages pool money from many investors and manage a portfolio of securities for their investors at a reasonable cost. Mutual funds are designed for the average or new investor and are extremely popular. In fact, if you have a typical 401k or similar plan at work, you will notice at a glance that most of the investment options offered are mutual funds.

Investing for retirement in an IRA has income tax advantages, and there are numerous ways to open and invest in these accounts. You can open an IRA at your local bank, through a life insurance agent, or with a brokerage firm. Millions of Americans open an IRA with a mutual fund company and make contributions on a regular basis. Others roll over money from one or more company pension plans to a mutual fund IRA to simplify and consolidate their retirement funds.

Probably the biggest advantage to mutual fund investing is the broad array of investment options offered. In the world of investing there are basically three different asset classes or investment options, and mutual funds offer easy access to all three. Stock or equity funds invest your money in stocks for long term growth and potentially higher profits. Bond funds offer higher interest income, and money market funds feature safety and pay competitive interest rates.

Few average investors have the time, experience, or financial education required to manage a portfolio of individual securities like stocks and bonds. Try investing for retirement or in retirement with a team of professional investment managers on your side. Focus on mutual funds and learn all you can about them.

A retired financial planner, James Leitz has an MBA (finance) and 35 years of investing experience. For 20 years he advised individual investors, working directly with them helping them to reach their financial goals.

Jim is the author of a complete investor guide, Invest Informed, designed for average investors or would-be investors of all levels of financial background and experience. To learn more about investments and investing and his new financial guide go to http://www.investinformed.com.

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Update May 03 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-05-03T06:32:00.000-07:00

Variable Annuity Life Insurance - One Retirement Planning Option

By Gordon H. Smith

Variable annuity life insurance is one among many competing life insurance products. There are different types of insurance that are being offered to everyone and this insurance has benefits as well as their disadvantages. But they were originally made and offer not to get money from their clients but to help them.

With our community now it's hard to tell for some of the people who get insurance thinks that insurance companies trick them to buy insurance only to get money from them which is not totally true. There are some insurance companies, who get money from their client but makes sure that their clients and customer are satisfied with their services.

One of these insurance that are being offered to people is variable annuity life insurance. This insurance offers their clients like you an income for a lifetime. And it can help you increase your money through investments in the bonds and stocks.

It provides the insurance holder with big amount of money and a tax-deferred monthly payment plan. This type of insurance is the opposite of life insurance. For in life insurance you are required to pay the insurance company a monthly payment and they give you a large sum when you die.

However this type of insurance is quite the opposite since you will be giving a big amount of money to the insurance company and in return they will give you a specific periodic amount.

Here are some tips for you before you get yourself insurance.

Getting yourself insurance is not as easy as you think. Before you get it you have to understand and know something about insurance. Although they can help you in some way but there are also some insurance which you don't need after all knowledge is power. After all you wouldn't want yourself buying insurance which you won't need.

You also must know what kind of insurance you need. Like when you want to get a variable annuity life insurance before you get it you need to know if you are going to need it. Ask yourself what benefits you'll get out of it and what disadvantage you'll get.

This type of insurance is more like an investment with no assurance for in variable annuity you are free to choose where you want to put your money but there are no assurance in which you could get back your principles when something happens to the place where you chose to put your money.

The advantage you'll likely get out of this type of investment is that when the funds in your annuity increases it value the payment you will be receiving will also increase. Also since it is life insurance it offers you a feature that will benefit your beneficiary when you are dead.

Usually this benefit is the contribution you made in your annuity minus the money you received. While on the other hand the disadvantage is that if you die before the annuity payment is complete then the earnings remaining in your account can forfeited to the company.

Money is not a light matter so before you buy something, make sure to not regret your decision. That is why it is better to know where you're standing and think twice before you make your decision.

You can compare your different variable annuity life insurance options by getting some free quotes online. One place to get them is http://lifeinsuranceannuities.org which specializes in these types of quotes.

You can find out more from Gordon Smith's website or click on the links above.

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Update April 03 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-04-03T07:44:00.000-07:00

Retirement Planning - 5 Reasons For Planning a 21st Century Retirement

By Chris Moon-Willems

Retirement is one of the most significant changes you will ever experience and yet most people do more research and spend more time planning a holiday, than they do their retirement.

Up to now retirement planning meant, 'Do you have enough money?' because retirement planning comes from financial planners and life insurance companies. However if we are going to be spending 30 or 40 years in this phase of life, we need to plan for it properly and well in advance.

Despite the significant changes taking place, most people are living in today's world, and planning yesterday's retirement. So why should we approach retirement differently?

• Retirees today are much healthier, more active and can expect to live longer than they could in the past. We are in a unique position and facing a future that looks nothing like our parents' second half of life.
• Our retirement plans are reflections of those of our grandparents or parents but our chances of living a long life are not. We're living in the 21st century and planning a 20th Century retirement!
• Attitudes regarding health and well-being are short sighted. Our lifestyle habits such as diet, smoking and drinking, illustrate the extent to which we prioritize the present at the expense of our future.
• When it comes to planning finances, our disregard for the future is blindingly obvious. Many people are saving nothing or too little towards their retirement. Increasing levels of debt are being accrued with many unaware of the difficulties they will encounter later in life, or are unsure how to plan for them.
• The percentage of people in mid life who are divorced or separated has more than doubled over the past 20 years. A fact which places greater pressure on our ability to look after ourself. This was less necessary in the past, when most people were in stable couple relationships.

Your retirement will be as unique as your fingerprint. With effective planning you can transform how you approach retirement and the enjoyment and fulfillment you get from it.

Make the most of the opportunities it can offer and start planning now!

Are you ready to begin planning your retirement? Would you like help to think differently about retirement and to identify any obstacles,road blocks or fears you have about retirement transition?
Visit http://www.newmooncoaching.co.uk for information about how coaching could support your retirement transition.

Chris Moon-Willems is a Social Work professional, Retirement Success Coach, Life Coach and Master NLP Practitioner who specializes in helping women over 50, who have been through divorce, bereavement or relationship break down, to plan the second half of their life.Visit her blog at http://www.chrismoonwillems.com.

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Update Mar. 14 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-03-14T07:06:00.000-07:00

Retirement Planning - The Role of Life Insurance

By D. Victor

Someone once asked me "What does life insurance have to do with retirement?". It was a good question, since the link between the two is not blatantly obvious to most. For those who are familiar with financial planning, the connection between them is all too apparent. Life policies and retirement planning are related in the more than a couple ways.

Forced savings

One of the benefits of cash-value life plans (that term-plan apologists fail to recognise) is forced savings. The reality is that those who lack financial discipline would not save much or "invest the difference" without cash-value plans. The savings portfolio helps those folks put aside money that can be used for their golden years.

Contributions towards your accumulated fund

Good cash-value plans that have been in existence for more than 15 years would accumulate a significant sum by the time you wish to retire. You can use these funds to augment your accumulated savings or use the interest or dividends to contribute to your income stream.

How much you have to save towards retirement

You would not want to pay so much for your insurance that you reduce your options for retirement planning. When planning, you would normally determine what percentage of your income that you could save. A life-cover premium could decrease this amount. On the other hand, your retirement planning commitments can reduce the amount you have to finance a life insurance plan. This is why it is a good option to seek low-cost insurance or term policies for short and medium-term life coverage.

Hybrid retirement plans with some aspect of life insurance

Some retirement plans offer life insurance. As part of your financial planning, you may decide that it creates higher value to choose such a plan than to seek other financial instruments and life insurance separately.

Retirement planning for couples

For those who are married, the retirement status of both spouses is critical. If one spouse is not working or has a low pension, life cover may be a way of ensuring that the other spouse can have a replacement income in the event of death of the earning spouse. Life assurance protects your loved ones who may depend on you during retirement as well.

Life insurance with optional supplementary benefits

Some plans are embedded with long-term health care and critical illness as supplementary benefits that could extend into retirement. These "riders" usually have a reduced cost than stand-alone plans and could be used to offset the medical insurance aspect that is vital to planning.

How much insurance to keep after retirement

When you retire, you should normally reassess your life policy. Retirement planning may influence the type of cover you would buy. If you are using life policies to protect your spouse who may be wholly or partially dependent on your income, you may choose permanent insurance. If you figure that your mortgage needs would be taken care of and you would have financed your children's education by retirement, your choice may be term plans.

The link between life plans and retirement planning is a moderate one. This is because retirement planning is merely an extension of financial planning. It is true that insurance is a vital cog in the wheel of most people's financial plan. Once you understand the link between the two concepts, it would be easier to plan for one in terms of the other.

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Update Feb. 20 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-02-20T09:45:00.000-08:00

Financial Planning Benefits - Retirement Planning

By Lon Jefferies

Retirement Projection
A key component of every financial plan is a retirement projection mapping out the type of lifestyle the client would like to enjoy, and how they are going to obtain their goals. This calculation depends on several key factors: the client's current age, size of their nest egg, expected retirement date, desired lifestyle during retirement, and a projected life expectancy. Other variables to consider are the rate of return the client's investments can achieve (both before and after retirement), how much the client can contribute to their nest egg before retiring, and the effects of inflation.

One term you should hear your financial advisor say frequently is "conservative." Being conservative when constructing a financial plan is critical -- after all, would you rather end up living a more lavish lifestyle than you anticipated and leaving a legacy to your heirs, or bankrupt and unable to pay for basic living materials such as food and health care? Consequently, the assumptions made in your plan should always be conservative and achievable.

Putting It All Together
How do these factors come together to create a valuable tool for the client? Let's assume the clients are 55 years old, plan to retire by 65, and would like to maintain their standard of living during retirement which requires $60,000 per year. The clients expect a total of approximately $40,000 per year in Social Security payments, so they will need the inflation-adjusted equivalent of $20,000 per year to meet their needs. These clients have a strong history of saving, and have already accumulated a nest egg of $300,000 between their IRAs and 401(k)s. These are the facts.

At this point, conservative assumptions need to be made. Even though the stock market has averaged a rate of return of 10% over the last 100 years, an experienced financial planner might assume the clients can achieve an 8% return until retirement, and a 6% return during retirement (as the clients age, the portfolio should become more conservative, lowing both the risk and return of the investment). Additionally, the planner might assume inflation will average 3% per year (average over the last 100 years). Finally, although the 55 year old clients are statistically likely to live until age 90, the planner will assume they will live to age 95 --after all, the goal is to not run out of money!

Using these inputs we run a Monte Carlo analysis which runs thousands of simulations to determine the chances the clients will have assets to support themselves until death. The analysis indicates that the clients only have a 35% chance of not outliving their money.

However, we can now create a schedule for retirement contributions that will increase the clients' odds of success. For instance, if the clients contribute $5,000 to an IRA each year until retirement, the chance of not outliving their assets increases to 87%. Moreover, we can now start asking questions such as "What if the clients wants to retire early?" Our retirement plan indicates that if the clients contribute $12,000 per year to their retirement accounts, they can successfully retire at age 63, or contribute $18,000 per year to retire at 62.

The Benefit of a Financial Plan
This is an example of how financial advisors utilizes retirement planning tools to ensure their clients are on pace to live the retirement they envision. Together, the clients and planners can then follow the strategies and schedule determined to best accomplish the goal. This process is then repeated at least annually to reflect changing circumstances in the market and changes in life. Frequently updating the financial plan maximizes the probability the client's goals will be achieved.

Lon Jefferies is an investment advisor representative with Net Worth Advisory Group, a fee-only financial planning and investment advisory firm in Salt Lake City, Utah. He specializes in developing custom financial plans, implementing investment strategies, and providing ongoing support and service in order to help clients reach their financial goals. He can be contacted at (801) 566-0740 or lon@networthadvice.com.
Visit the Net Worth Advisory Group website at http://networthadvice.com and read Lon's blog at http://www.utahfinancialadvisor.blogspot.com.

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Update Feb. 01 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-02-01T04:54:00.000-08:00

To Read Part B. Scroll Down please
Part A. Women Have Unique Retirement Planning Needs

By Andrew Brake

Translating retirement dreams into reality can be challenging-especially for women, who often must overcome unique, gender-specific hurdles to achieve financial security.

These challenges include lower average earnings, child custody and support, elder care and longer life expectancies than men. This series of articles explores these special gender-based issues to help women become better informed about retirement and financial planning.

As more women have entered the workforce and their pay moves toward parity with men, women now have more opportunities to save and invest for retirement. But simply increasing women's financial power will not necessarily result in a higher quality of personal retirement planning, greater participation in retirement plans, a higher rate of savings or smarter investing.

The facts tell the story:

• Women live longer-Statistically, women outlive men by an average of about five years. This suggests they will have to save more because they'll have more years of retirement to fund.
• Women save less-The women's median contribution rate is 6% vs. 8% for men, according to the Ninth Annual Transamerica Small Business Retirement Survey (September 2008), although the savings rate for both men and women falls short of the minimum recommended 10%. Only 10% of the women surveyed reported household retirement savings totaling over $100,000, compared to 29% of men.
• Women start saving later-Women postpone retirement saving later in life than men, so they have fewer years to accumulate a retirement nest egg.
• Women have less to invest-Generally, women have less to invest since, on average, they earn less than men.

The poverty rate for all elderly women is 13% according to the U.S. Census Bureau in 2008. However, the University of Michigan Retirement Research Center (May 2003) found that for widows, divorced and never-married women, the rate jumps to over 18%. Too many rely on Social Security as their sole source of income.

Next, you'll learn more about the pay differential between men and women-one of the major financial challenges facing women as they plan for the future.

Women save less because they earn less

Despite significant achievements in the workplace, many women are still at a disadvantage when it comes to earning power. No matter what measure is used, women's earnings generally remain below those received by men.

According to the U.S. Census Bureau, the median earnings of full-time male workers was $43,460 in 2007. By the same measure, the median income for women was $33,437. But the gap between women's and men's earnings closed slightly. In 2007, the female-to-male earnings ratio was 0.78-higher than the previous all-time-high of 0.76, first recorded in 2001.

Various factors contribute to these earnings differences:

• Women's careers are interrupted more often for childbirth, childcare or elderly parent care.
• Even women who gain entry into high-paying jobs can be subject to these demands on time and attention.
• Smaller companies with smaller payrolls typically employ more women than men.
• Fewer women than men are union members.
• More women than men choose not to work outside the home.

For these reasons, it can be especially important for women to become informed about retirement and financial planning programs-and to participate in employer-sponsored retirement plans.

Next, we will discuss the competitive demands that many working women face-and often face alone: the care of children and elderly parents.

The challenges of providing child and elder care

Women's traditional role as caregivers for both children and elderly family members often impose special financial hardships and make it even more difficult to set aside money for the future.

This is especially true for women who are custodial parents, dependent on child support payments that might or might not be forthcoming. According to the 2005 edition of Child Support for Custodial Mothers and Fathers, a U.S. Census Bureau report, an estimated 13.6 million parents had custody of children under 21 years of age. And five of every six custodial parents were women.

Custodial mothers are more likely than fathers to work part time and have the greatest need for child support. Yet, the Census Bureau study found that among the more than 11 million custodial mothers, only 2.9 million were receiving the full amount of their court-ordered child support payments. Clearly, the unsupplemented burden of child and household support falls more often to women with single incomes-a fact that can have a devastating effect on retirement-planning efforts.

Caring for the elderly

Nearly one in four of the nation's households is involved in caregiving to family members or friends aged 50 or older. And about 75% of those caregivers are women. (Source: 101 Facts on the Status of Workingwomen, published in 2005 by the Business and Professional Women's Foundation). The BPWF report also stated that 27% of all caregivers are daughters of those receiving the care, and that female caregivers spend 50% more time providing care than male caregivers.

Further, according to the BPWF, employed caregivers are more likely to miss work, lose a job or career opportunity or experience other negative economic effects.

And then there is the direct financial impact. Elderly people living on a fixed income can have more difficulty paying utility bills, medical deductibles, nursing home bills or home healthcare charges. When the elderly parent runs a little short, the caregiver might be required to make up the shortfall. Again, this can reduce the amount available to save for retirement.

What women can do to prepare for the future

Financial planning begins with becoming educated about key financial issues. That's not as difficult as it might sound, because it just takes some time to read up on finances in dozens of personal financial management books and magazines on the market.

These publications explain the pros and cons of investments such as mutual funds, variable annuities, certificates of deposit (CDs), money market funds and other investments; savings programs such as workplace retirement plans and Individual Retirement Accounts (IRAs); and the concept of risk management through life and long-term care insurance.

Next, acquire an understanding of cash management. This involves monitoring your checkbook, determining where your money goes every month, and finding ways to reduce these outflows if they exceed your income. Budgeting is the most basic, most effective way to sort out balance income and outgo, identify expenses that need to be reduced and provide a framework for managing your finances.

Now is the time to start using the five-step retirement-planning process:

• Set goals
• Analyze current financial position
• Develop strategies
• Choose specific investment options
• Evaluate and follow up on your plan

This process can help you determine how much money you'll need at retirement and make decisions about how to start accumulating that money. For more information about financial and retirement planning for women, contact financial advisor, Andrew Brake @ 336-833-3066 or andrew.brake@valic.com.

Securities and investment advisory services are offered by VALIC Financial Advisors, Inc., member FINRA and an SEC-registered investment advisor.

VALIC represents The Variable Annuity Life Insurance Company and its subsidiaries, VALIC Financial Advisors, Inc. and VALIC Retirement Services Company.

VALIC.com

Andrew R. Brake, MBA, CRPS® - Financial Advisor
Atlantic Region - Western Carolina District
VALIC Financial Advisors, Inc.

7029 Albert Pick Road, Suite 206, Greensboro, NC 27409
Office: 336-833-3066 Voicemail: 800-892-5558 ext. 88037
andrew.brake@valic.com
http://www.VALIC.com

Part B. Implementing a Successful Retirement Strategy or Plan

By Lateeef Ajibade

The idea of retirement is changing and there is more to retirement planning than just saving money and having life insurance. If you have been diligent in saving for your retirement from the beginning of your career, a mistake may potentially jeopardize your entire savings. This is why you need to plan and run a realistic cash-flow projection that can predict with a reasonable accuracy whether a portfolio with no or limited market risk can sustain you through your retirement years.

In every retirement financial plan, there are three major factor you need to put into consideration. First you have to decide on how much you can afford to save monthly or annually. Second, you have to invest the money appropriately. Finally, you will need to have a sense of how much money you need after you retire, in order to maintain your desire standard of living and cover your expenses.

Basically, people tend to focus on the first two factors because you are in control of how much you save and how much you invest, whereas you may have no clue of how much you will need decades from now or how long you will live.

A lot of people make the mistake of investing all or nearly all their money in the stock market in an attempt to boost returns by taking high risk. Those bets might work out but when they don't, they put you in a state of bankruptcy like they are doing to investors in this year's bear market.

You can be on a safe side by diversifying your portfolio in the following areas

i. exchange traded funds
ii. money market instruments
iii. commodity assets
iv. real estate investment
v. bond investment
vi. pick a second career after retirement
vii. take life insurance with reputable insurance company
viii. start internet business

Lateef Ajibade
Ajibade54@gmail.com

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Update Jan. 13 - 2010 "Life Insurance And Retirement Planning" By Insurance Experts

2010-01-13T04:37:00.000-08:00

Retirement Planning - Tips For Proper Retirement Planning

By Jay Royster

Retirement planning the right way is a concern many Americans have but don't have many answers for. Saving as much money as you can while young and investing it as you get older is a good way to create wealth. The key however is to start as early as possible, so your money that is invested can grow over a longer period of time.

401(K) Plan

A 401(k) plan is an excellent retirement planning option because taxes can be deferred and automatically saves money for you. Also, penalties will occur if the money is withdrawn too early, providing great incentive not to spontaneously take money out for any reason.

The key point here is to begin putting away as much money as you can early on so that your wealth will continue to grow from your investments. This is especially important in today's age because our life expectancy is going to continue to increase, so you want as much money as possible available when retirement comes around.

How Much Money Will You Need?

Also, with the uncertainty surrounding health care in America going forward, retirement planning at an early age and correctly becomes even more significant. By the time you retire, you will need to be able to cover any potential medical expenses in addition to everyday living.

One other issue that should be addressed is the amount of money you will need in order to live a comfortable lifestyle during retirement. Calculating an exact amount at a young age that guarantees a comfortable retirement isn't very realistic, but you can reasonably come up with a range financially to meet your goals.

Learn More

Find out how to find the best retirement planning service for you.

http://bestretirementinvestmentplan.com

Article Source: http://EzineArticles.com/?expert=Jay_Royster

Early Retirement Planning - Your Stuff May Be Holding You Back

By Gary Pierce

When doing your early retirement planning identify the cost of maintaining your possessions...it is probably significant.

By that, I mean what does it really cost for you to live in a certain neighborhood and maintain appearances.

If you live in an area with big yards how much time do you put into maintaining the yard...what does it cost you? If you have a lawn service, what does it cost? Remember these costs would be eliminated if you retired to a condominium.

Do your neighbors have new cars every 2 years or so. If you do the same, that has a cost associated with doing so. Do you say to yourself, there is nothing wrong with the car I have now why am I buying a new car?That is an unnecessary purchase folks.

Does everyone have exterior lights at Christmas? Do the neighborhood children go to private schools? Is there a country club that your neighbors belong too?

Get the picture...there are many ways to be bogged down in costly practices to maintain appearances. Identify these non-essential, you have been brainwashed into thinking they are essential, items and add up what they are costing you. You may be a lot closer to retirement if you do so.

This not meant to criticize but you can easily be seduced into thinking these items are necessary. They are not...you do not "need" them at all. A condominium is just fine, it gives you more time to play; your 10-year-old car runs great and is very functional; you can go to the YMCA and work out just as easily as going to a country club.

Identify and quantify the cost of your stuff. Your early retirement planning may have gotten a little easier. Enjoy.

Early retirement planning. Gary Pierce is the webmaster of http://www.frugal-retirement-living.com he retired early at 49, he is still retired at 64. He has experience in lifestyles that are both fulfilling and frugal. It is 2009 and many are wondering if they can ever retire. Don't give up until you check out this website. Enjoy.

Article Source: http://EzineArticles.com/?expert=Gary_Pierce

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Update Dec. 26 - 2009 "Life Insurance And Retirement Planning" By Insurance Experts

2009-12-26T05:13:00.000-08:00

Retirement Planning - Ten Biggest Misconceptions About Fixed Annuities

By Dr. Shelby Smith

No other savings vehicle is as misunderstood, under appreciated and maligned as fixed annuities. Most people who can benefit from annuities have been bombarded by misinformation, biased opinions and outright lies. The truth is: fixed annuities are safe because they are guaranteed by insurance companies, a great place to keep retirement money because they pay tax-deferred competitive returns, and all of your money is working 100% of the time. Like all investments, fixed annuities are sometimes not suitable nor should anyone have all their retirement money in fixed annuities.

Sometimes those providing information about fixed annuities have hidden agendas, biased opinions and/or little knowledge. Many personal financial columnists for newspapers and magazines fall into this category: their opinion is tainted by their brokerage background, the agenda is to get you to put your money in market investments that compete with annuities, and their limited knowledge was supplied by the brokerage industry. Why is the brokerage industry biased? Because they offer investments that compete with fixed annuities! In their mind an "annuity purchased" is a "brokerage commission lost". Unfortunately, the biases of many columnists and brokers may be unknown even to them.

Notwithstanding all the misconceptions about fixed annuities, it is important that you always understand your investments and confirm they are suitable for you. The best way to get fixed annuities "right" is to work with a financial advisor you like, trust and whose best interest is your best interest. Below are the ten biggest misconceptions of fixed annuities and a short rebuttal of why they are not true.

Come with huge surrender penalties: like all contracts, penalties are assessed for breaking the rules, otherwise there are no penalties.
All charge high fees: like bank CDs, annuity fees are built-in and not taken from the principal amount you put into an annuity or the interest you earn.
Are extremely hard to understand: no more so than any investment or savings option, in fact, annuities are far easier to understand than most investments.
Money is tied up for a long period of time: you have access to your money at all times and without penalties if you abide by the annuity contract.
Nothing is left for my family if I die: not only is this not true, your money bypasses probate without delay if you've named a beneficiary.
Different types of annuities are confusing: there are only four main types of annuities compared to thousands of mutual funds.
Not good for older folks: they are especially good for seniors because they are safe, tax-deferred and convertible to a guaranteed lifetime income.
They are not safe: rock-solid safe with never a penny of principal lost due to the guarantee by the same insurance companies protecting our other assets.
Agents are paid huge commissions to sell: agent commissions are paid by the insurance company, not taken from the principal or earnings.
Annuities are a substitute for life insurance: annuities are great for retirement savings but not good for wealth transfer like life insurance.

The next time you hear a scary story about fixed annuities, consider the source to determine if it is biased, misinformed or just plain lying. If you put your money in an annuity, make sure you understand how it works and is suitable for you. Like all savings and investment places, fixed annuities work great if used for their intended purpose: annuities are intended for risk adverse, safety conscious, retirement-minded savers who are satisfied with a competitive rate of return.

Shelby J. Smith, Ph.D.
December 2009

For more information check out the new Retirement Pros website http://www.theretirementpros.com/ and visit our blog at http://www.theretirementpros.com/blog to post questions/concerns.

Article Source: http://EzineArticles.com/?expert=Dr._Shelby_Smith

Immediate Vs Deferred Annuities For Retirement Planning

By Marilyn Katz

Have you Heard About Retirement Planning with Annuities?

It is hard to walk into a bank or speak with an insurance agent without hearing about retirement annuities. There is a lot of interest because these insurance company products have some of the features of inusrance and savings or investments. Because of this, they may be a safe and sound way for you to plan for your future goals.

Although they have other uses, one basic goal that many purchasers have is retirement planning. Keep in mind that your retirement may be coming up next month, you may already be retired, or you may be planning for a goal that is many years down the road. Your own choices will depend upon your individual situation.

Immediate Annuities For Income Now

If you have a lump sum of money that you collected from your job, or have just saved over a period of years, you may be interested in having a way for that money to produce a guaranteed income for you. Of course, your options will be affected by the amount of money you have and the amount of income you want to collect. With an immediate income product, you can deposit your money this month and start collecting your income next month!

You can choose a variety of payout options. Some popular examples may be 10 years, lifetime, or joint survivor (the surviving spouse collects). Again, your choice will depend upon your financial goals and the amount of money you have to deposit.

You may choose 10 years if you have another investment that will mature down the road, or if you just want income now so you can start that retirement business you always dreamed of.

You may choose a lifetime payout if you just want to insure that you will have an income for your retirement years.

Deferred Annuities For Income Later

If you want to start building a lump sum for retirement, you should look into deferred products. You may invest some money now, and then keep making contributions periodically, say every month or every year, so that your cash account will grow over time.

The money will grow without being taxed. If you used pre-tax dollars to invest, you will be taxed when you withdraw it. If you already paid taxes on the money, you will not be taxed later. This can be a good way to get the maximum mileage out of your investment money.

How Does The Cash Account Grow?

You may by an annuity with a fixed interest rate. Or you may decide to choose one of the popular indexed annuities that is tied to a major market index.

How is Risk Eliminated?

A fixed annuity, that is tied to a market index, should come with a guarantee that you will never lose money too. In up years, your gain may be somewhat less than the market's growth, but in down years, your gain should be fixed to 2 or 3 percent growth. The potential of gain, while still eliminating the risk of loss, is one reason that annuities are popular ways to plan for retirement.

If you are planning for your retirement, you probably want to speak with a qualified professional about annuities. We urge you to educate yourself on the variety of products in your local area.

We provide free annuity quotes with a safe, fast, and free online form. It is a quick form, and it does not obligate you to do anything.

For more information, please see - Explain Annuities

Article Source: http://EzineArticles.com/?expert=Marilyn_Katz

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Update Dec. 06 - 2009 "Life Insurance And Retirement Planning" By Insurance Experts

2009-12-06T05:23:00.000-08:00

Immediate Vs Deferred Annuities For Retirement Planning

By Marilyn Katz

Have you Heard About Retirement Planning with Annuities?

Immediate Annuities For Income Now

You may choose 10 years if you have another investment that will mature down the road, or if you just want income now so you can start that retirement business you always dreamed of.

You may choose a lifetime payout if you just want to insure that you will have an income for your retirement years.

Deferred Annuities For Income Later

How Does The Cash Account Grow?

You may by an annuity with a fixed interest rate. Or you may decide to choose one of the popular indexed annuities that is tied to a major market index.

How is Risk Eliminated?

If you are planning for your retirement, you probably want to speak with a qualified professional about annuities. We urge you to educate yourself on the variety of products in your local area.

We provide free annuity quotes with a safe, fast, and free online form. It is a quick form, and it does not obligate you to do anything.

For more information, please see - Explain Annuities

Article Source: http://EzineArticles.com/?expert=Marilyn_Katz

Getting Back on Track - A Retirement Account Recovery Action Plan

By Chris Hobart

Just one year ago the American economy took a turn for the worse, and ever since many individuals have been experiencing financial difficulties, especially in the realm of retirement saving.

This is one of the largest market breakdowns since the Great Depression, and retirement accounts have taken a tremendous tumble, but now is not the time to sit idle and watch your retirement account dwindle. It is time for individuals to wake-up and take action to get their retirement accounts back in line.

"Fear" seems to be the number one cause of inaction among American retirement savers. With a lingering unstable economy, retirement savers just don't know what to do. They're worried about a laundry list of things and they need help understanding how to move past the troubles of today to continue to save for tomorrow.

There are three most common concerns regarding retirement planning these days and individuals need insight on how to resolve these worries, scale back the impact the economy has on one's retirement accounts, and get back on track towards reaching your retirement savings goals.

Concern #1: Recouping Losses

It is a fact that retirement account values are down. Kiplinger's Personal Finance reported that in 2008, more than 40 percent of workers in the United States saw their 401(k) account balance drop by 30 percent or more. This change toward the negative is definitely a cause for concern, but that doesn't mean that you definitely won't be able to retire on time. There are ways to recover from these dramatic drops in retirement account values. Depending on what your intentions for money in retirement accounts may be, income or inheritance, there are a few tips you can use to regain account value. Consider the following:

Good for almost all retirement accounts and all purposes:

· Change up your retirement strategy - Regardless of your intentions, with all the fluctuations in the market over the past year, an evolution of your retirement savings strategy needs to take place if it hasn't already.

· Evaluate your risk tolerance - While younger investors have the time to ride the fluctuations in the stock market, those approaching or already in retirement should not have more than they can afford to lose in the markets. Be sure your investment strategy matches your investment objectives and your timeline towards retirement; if the money is earmarked for retirement and your soon-to-be future financial safety, then be sure the funds are safely and wisely invested.

If you will definitely need the money in retirement, consider:

· Rearranging the investments within a retirement plan - find a type of investment that is either faring better or holds less risk in order to not lose more money earmarked for retirement. Remember, if you're down 50 percent in your account value, you will need to recoup 100 percent to break even.

· Incorporating alternative investments - If you do not have a lot of time left until retirement consider some investment alternatives such as municipal bonds, CDs and fixed annuities which offer low risk growth.

If you intended to leave your retirement savings as an inheritance:

· Consider buying life insurance - As a quick solution to getting money intended for family back, consider a life insurance policy. A life insurance policy can bring account values to pre-loss values or higher, and there are certain tax advantages that come with a life insurance inheritance versus an investment inheritance. To learn more, speak to a qualified life insurance representative.

Concern #2: Outliving Savings

It is hard to enjoy retirement if you are living in fear of running out of savings, but in light of the changes in the economy and the ups and downs of the market, the pre-retired and retired are finding their retirement accounts are coming up short. In many cases after having to delay or postpone retirement, people have realized they need to address savings shortcomings sooner rather than later to get caught up and meet their needs for retirement. To ensure your nest egg goes the distance, consider the following tips:

· Know how much you'll need for income in retirement - A good estimation is that you will need 70 percent of your annual yearly income for each year you are retired. Be sure to factor in inflation, which has averaged 3 percent over the last 20 years.

When you're done crunching the numbers, keep your overall savings target in mind and be aware of how near or far from that goal you are at all times to avoid outliving your savings.

· Know your monthly income - Try to keep track of all possible sources of income in retirement, however small they may be, in order to get an accurate figure for what you'll be taking in each month. Common sources of retirement income include Social Security, retirement pensions and savings. After you've calculated this number see how much of a difference you'll have to make up to hit your goal of 70 percent.

· Catch-up where you can - If you are lagging behind, consider catching up your savings with a catch-up contribution in your retirement plan. This provision allows anyone 50 or older to contribute extra money into a retirement account. The 2009 maximum contribution amounts for an IRA holder are $5,000 this year, and if you turn 50 in 2009 or older, you can take advantage of the IRS catch-up provision of $1,000 extra, bringing your maximum IRA contributions to $6,000 per year. Contribution limits for 401(k) plans depend on income and age, check with your financial advisor or plan administrator to determine the specific provisions.

Concern #3: Minimizing Taxes

It's hard not to worry about taxes - they are a prevalent part of American society and are virtually unavoidable, which is why many Charlotte residents are concerned that taxes will go up and eat away at their retirement savings in the future. This concern is valid as taxes on retirement accounts can be a huge burden. To mitigate your tax liabilities in retirement, consider the following:

· Evaluate the tax advantages of your different retirement savings accounts - Create a plan for how and when you'll withdraw funds for retirement from each account type, also known as income planning. By being strategic in your distributions, you can save money in taxes and fees as well as allow for continued growth in well performing savings accounts.

· Review your current retirement savings account - Not all retirement accounts offer the same tax benefits, so you may need to consider changing your retirement account type depending on how and when you are going to need the money in retirement. If you're concerned about rising taxes, you may want to consider a rollover to a Roth IRA. Tax benefits of a Roth include:

· Not having to pay taxes when (and if) you decide to withdraw your savings (because taxes are paid when you contribute funds, not upon withdrawal).

· Monies earned on the principal in a Roth IRA grow tax-free, meaning they will retain their value better than a traditional IRA or 401(k) that will be subjected to taxes.

· The absence of a Required Minimum Distribution - 70 ½ is the mandatory age by which you must begin taking funds out of a retirement account. This can be helpful if you don't need your retirement funds right away or would like to leave the money in the account as a "stretch" IRA to give to your family when you pass.

In this market, being afraid and doing nothing won't get you anywhere. Overcoming worries and getting a good grasp on retirement accounts is the only way to pull yourself out of the economic black hole and get back on track to retirement saving.

Chris Hobart is founder and president of Hobart Financial Group, Inc., an independent financial advisory firm based in Charlotte, North Carolina. As a retirement planning and 401(k) rollover specialist, Hobart assists individuals with the transition into retirement. Hobart is a Registered Financial Consultant (RFC?), Investment Advisor Representative (IAR), and Chartered Senior Financial Planner (CSFP). In 2008, Hobart was named as one of the nation's top independent financial advisors and was a finalist for Senior Market Advisor Magazine's "Advisor of the Year" because of his commitment to excellence as a leader in the retirement planning profession and within the Charlotte community. For more information about Chris Hobart and Hobart Financial Group, Inc., please visit http://www.ChrisHobart.com

Article Source: http://EzineArticles.com/?expert=Chris_Hobart

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Update Nov. 18 2009 "Life Insurance And Retirement Planning" By Insurance Experts

2009-11-18T07:28:00.000-08:00

Getting Started With Retirement Planning

By Doeren Mayhew

Determining when to retire and the way you want it to happen is probably one of your most important economic goals. Things may influence you when deciding to retire - your own personal condition may be or it may be because of the instability of economic situation such as tax law changes.

You may build up a plan on your own to make sure that you have the right assets to go on retirement. Your plan does not necessarily have to be followed verbatim but having it will help you in reaching your specific goals. Through careful assessment of your objectives and altering it when needed, you'll be able to notice that your odds in reaching your retirement goals will surprisingly increase or possibly exceed.

There are many rudiments in making a retirement plan. It may not be easy because of the multifaceted and unpredictable issues present when making the plan but it may be the beginning. After comprehending the information given, you may start calling and consulting your financial mentor to talk about your goals. Your mentor can aide you in devising and improving your plan to help you attain your ultimate goal - financial security. It is best to start early in devising your plan. As the saying goes, "the earlier, the better" because of the following reasons:

• You'll have more time to build a retirement nest egg.
• High tendency to make your savings program a habit.
• And most importantly, time can magnify the effects of compounding.

These are three reasons which are essential to your financial achievement.

After taking some time to read tips like this, you'll eventually gain enough knowledge in making up your own retirement plan, get ideas on what are the important things to do as you go on planning and most significantly, discover the right ways to keep away from the problems that you may meet along the way. If you haven't start thinking on having a retirement plan yet, no need to worry; you may miss certain chances but it's never too late.

This data is distributed for informational purposes only, with the understanding that Doeren Mayhew is not rendering legal, accounting, or other professional advice or opinions and assumes no liability in connection with its use. Please contact Doeren Mayhew for more information.

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Retirement Planning - How to Plan and Retire in Comfort

By Jared Wright

After many years of focusing on a career most people look forward to the day they can retire and have time to do all those things they never got time for. By the time a person reach the age of 65 most will retire and most companies expect you to retire at that age. The question is will you be able to retire with comfort?

There are many people that realize too late that they might be at the right age for retirement, but that they can't afford to retire. If you don't make provision while you are still working you might have to end up working much longer than you anticipated.

While social security will prevent you from starving it might not be enough to allow for the lifestyle you are accustomed to or want after retirement. You might want to travel more or pursue some hobbies you have always been interested in and for that you will need money.

The fulltime retirement age for social security benefits are increasing and for those born in 1960 retirement age will be only at 67. If you plan to retire earlier you will have to forfeit some of the benefits. For those who have 67 as their fulltime retirement age and want to retire at 62 the benefit will be 30% less.

If you, however, start your retirement planning early in life you might even be able to retire earlier than at 65.

The following are things you should consider:

1. Start saving early in your working life. There are many options from saving plans to retirement annuities or investments.

2. Invest in a good medical plan. You might be in perfect health but with age comes ailments and you never know when you will need more money for medical expenses.

3. Reduce your living costs. While the children are still at home you might want to have a big home with a swimming pool and entertainment facilities, but if it is only you or you and your spouse still living in the house, decide if you really need all of that. You can move to a smaller place or consider a retirement village.

4. Consider a part time job. Teachers who retire can for instance offer extra classes. It can only be for a few hours a week. A hobby such as sowing or crafts can also become an extra income. You will do what you enjoy without being tied down to a fulltime job.

It is never too early to start planning for easy retirement.

Jared Wright has a huge passion for writing and sharing his knowledge with the online community. He has a wide variety of interests that he loves to write about. His latest site consists of articles offering useful information on motorized wheel chair and wheel chair parts.

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Update Oct. 30 2009 Life Insurance And Retirement Planning By Insurance Experts

2009-10-29T22:29:00.000-07:00

Pension Plans - Company-Sponsored Pensions Plans Cut & Offering 401k Retirement Plans

By Rocco Beatrice

Retirement Blues: Current Financial Crisis Forces Billions to be Pulled From Pension Plans

For everyone who has a pension plan, last year was one of the worst financial years. The crisis sucked more that $5 trillion from retirement plans that are company-oriented. This affected markets in the United States, as well as in Japan, the UK and The Netherlands. Due to the plunging stock market, there was a decline of 19% among worldwide assets. The only country that saw an increase in value was Germany.

United States pension plans were hit hard. These plans account for more than 60% of all global pension assets. The crisis resulted in company pension funds being under-funded by over $400 billion at the end of the year in 2008. Retirement accounts in the U.S. were declined by $2 trillion.

These massive losses have forced individuals planning to retire to adjust their retirement savings plans as well as their IRA & retirement plan investing. In many cases, people have completely stopped all traditional IRA and 401(k) plan contributions - some have completely went overboard by terminating their 401k plan all together. This will result in people having to work longer than they expected and may even force many to adjust their current lifestyles. These losses have severely affected the lives of people who had been relying on their retirement plan as a source of income. For example, the largest pension fund on Colorado lost $11 billion, more than 25% of its assets. The state pension fund in North Carolina lost 17% in value. Despite these huge losses, there are some companies who have found a way to increase the salary of CEO's, even though those same companies have slashed their pensions to other employees.

Losses of Pensions Will Have Enormous Effects

For anyone who has a retirement plan, these losses will be very painful. It will have an effect on almost every household in the U.S., especially for those who have also watched the value of their home depreciate or who have lost their jobs. The crisis does not only affect individuals, it will also play a part in corporate earnings.

Company-sponsored pension plans are becoming rare. More and more companies would rather place the liability and cost of retirement savings onto the employees. At one point, pension plans were a key part of the benefit package offered by a company. Now, they are becoming scarce. Instead, companies are offering 401k retirement plans. These plans still allow the employee to save for retirement, but the employee has to make contributions out of their pay check. For some, 401k plans were not the right choice. Many employees turned to a traditional IRA or a Roth IRA to help with retirement savings.

At the end of 2007, company pension plans were over-funded. By the end of 2008, after the financial crisis, these same plans were severely under-funded. This swing of over $400 billion resulted in only 75% of U.S. pension plans being funded.

When the stock market crashed, companies were faced with choices. They had to decide how to cut costs by taking the cash out of the business itself, or by decreasing the amount being placed into pension plans. The results of these decisions are having a huge impact on employees around the country who were trying to save for their retirement.

Best IRA Rescue provides services on your Roth IRA, IRA investments & traditional IRA and will help you reduce your inherited and beneficiary independent retirement account taxes in your estate assets. Roth on ROID™ is your advanced Roth IRA retirement planning strategy. It is Cash Value Life Insurance and one of the best IRA tax-savings strategies with benefits of a guaranteed death benefit, guaranteed principal, tax-free growth, and tax-free distributions from policy loans. Traditional IRAs and ROTH IRAs cannot invest in life insurance. Please contact us if you have any questions. Rocco Beatrice, CPA, MST, MBA
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The Principles of Financial Planning for Retirement Life

By Natalie Aranda

Retirement is something that needs to be planned for and it is best to start as early as possible. If you are reaching retirement age and haven’t started planning for your retirement, don’t panic. There is still time to take some proactive steps in order to ensure the best quality of life after you retire. If you are just starting out in the work force, retirement might not be on your mind but the sooner you start planning, the more money you can save.

There are several main principles of financial planning that you will want to pay attention to when you are planning for your retirement. First, you will want to make a realistic goal regarding how much money you will need once you retire. You will most likely spend seventy to ninety percent of what you are making now when you retire. You will also need to take a honest look at your finances to determine what your financial position is now. You should examine money flow in and out of your bank account as well as make a budget to help you pinpoint where you can reduce your expenses.

Once you know how much money you want to have once you reach retirement and where you are now, you’ll want to determine how much Social Security you will be receiving. Typically it will be about forty percent of what you earn now. You can get a free Social Security statement by contacting the Social Security Administration. Take a good look at what your employer offers in terms of pensions, profit sharing and 401K plans. If you are not already contributing to these plans, you should start. You should also start putting money into either a traditional IRA or a Roth IRA. You will be able to save on your taxes as well as save for retirement. Younger employees might also consider investments that might make you more profits, but are more risky.

Retirement planning is not complete without making sure that you have adequate life insurance. If you have a life insurance policy, you may be able to sell it if you no longer want it or need it. This is called a life insurance settlement. Life settlements can get you immediate cash which you can use to help fund your retirement.

With a little bit of preplanning, saving and investing, you can enjoy your retirement without having to worry about money at all.

Natalie Aranda writes about financial planning. Retirement planning is not complete without making sure that you have adequate life insurance. If you have a life insurance policy, you may be able to sell it if you no longer want it or need it. This is called a life insurance settlement. With a little bit of preplanning, saving and investing, you can enjoy your retirement without having to worry about money at all. Life settlements can get you immediate cash which you can use to help fund your retirement.

Article Source: http://EzineArticles.com/?expert=Natalie_Aranda

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Update Oct. 11 2009 Life Insurance And Retirement Planning By Insurance Experts

2009-10-11T06:37:00.000-07:00

You, Taxes and Retirement - Annuities, Roth IRAs, Social Security, & Life Insurance
By Dr. Shelby Smith

Regardless of where you turn there is a tax - income, sales, property, gas, estate, gift, liquor, tobacco, telephone, import, export, capital gains, unemployment, Social Security, Medicare and several hundred more that you pay knowingly and unknowingly. The National Bureau of Economic Research has estimated that the average worker is in the 40% marginal tax bracket. It has gotten so bad that not only must you pay a S.S. tax while working but you'll most likely pay income taxes on the SS benefits you receive. In fact, about the only tax that has been abolished in a retiree's lifetime is the "poll tax" - you are no longer taxed for voting. It seems that new taxes are being invented at an alarming rate. Politicians are fond of taxing corporations because they don't vote. Generally "tax-the-corporation is acceptable to citizens" because most think corporations actually pay taxes. Corporations do not pay taxes - they simply pass them forward to customers in the form of higher prices and lower wages/benefits.

Currently the economic and financial situation is in awful shape; as mentioned in this retirement blog. Elected officials, and the regulators that they have appointed to run our country's institutions, have grossly mismanaged our economy to the brink of absolute failure. Our government has taxed us to the hilt to support entitlement programs promises they can no longer deliver. To compound the problems they have foolishly gotten involved in war after war by rationalizing that our "national interest is in jeopardy". Certain businesses have enjoyed favorable tax treatment and/or allowed to operate with little regulation to the detriment of the general population. Our financial institutions have been encouraged to promote spendthrift ways to foster consumption today and pay tomorrow. In recent years the nation's saving rate has plummeted into minus territory as we've borrowed against the equity in our homes to take vacations, buy bigger cars, update wardrobes and buy second homes for relaxing from the stress-filled environment of a helter-skelter life of making more money to spend. The government solution to all these excesses is, you guessed it, spend our way to prosperity. This will lead to the cruelest tax of all, the silent killer that affects those least able to afford it and the one tax that few of use call a tax: inflation.

We now find our nation facing the worse economic and financial calamity since the great depression of the 1930's. In an effort to stem the economic tsunami that threatens to derail the American way of life, our governments is taking bold initiatives to bailout the wrecked institutions - from banks to housing to automobiles to individuals. Our Congress is busy piecing together a quilt-work of program to infuse trillions of dollars into the economy's businesses to keep them solvent to brighten the hopes they can survive in a global landscape. The massive collective debt that is being incurred by our government will have to be repaid - either by those now living or a future generation. In the meantime, those who hold the colossal U.S. debt will receive debt service payments in the form of semi-annual interest checks. In order to repay these huge deficits now piling up on top of an already gigantic national debt, it will be necessary to return the national savings rate to the plus category. This can be done in one of two ways or a combination: cut expenditures or raise taxes. There is a third way - that awful-tax we call "inflation" - but this is simply a subtle way of taxing by increasing the prices of everything. In fact, inflation has been called "the cruelest tax of all" because it falls on those least able to afford it: the poor, retired and other living on fixed income.

So, in the face of this mounting massive debt, which remedy do you suppose will be pursued by our governments? Will it be cutting expenditures? Or will higher taxes, including galloping inflation, be the answer? More than likely it will be a slight-of-hand maneuver sold as "more government expenditures to promote faster growth to restore economic and financial equilibrium". In other words, incentive will be provided to consume more and faster even though this is exactly the economic prescription that cause the problems we now face. This economic nostrum is tantamount to the snake oil elixir that was peddled in yesteryear to cure all ills and it will have the same curative powers. If you believe that governments are incapable of solving our economic and financial problems, you'll have to take matters into your hands to make sure your economic well-being, and that of your loved ones and heirs, is secure. Let's talk about some ways that can be accomplished.

First and foremost, there are taxes which I suspect will be rising over the foreseeable future. Of course, there will remain sizeable tax loopholes through which the wise can find ample fresh air to live a prosperous life. You've simply got to take advantage of every tax break approved by Congress - whether the benefits accrue to you while still alive or to your heirs once you've passed on to a heavenly economy where gold is used as a paving material. Check out the resources available below.

Resources: You, Taxes and Retirement (10 min video webinar) - Retirement Blog.

Article Source: http://EzineArticles.com/?expert=Dr._Shelby_Smith

Life Insurance and Retirement - What Happens?
By William T. Tyler

Anyone hoping to retire at a specific point in the future should begin planning for that date years in advance. Upon retirement, you will need to have many areas of your life and finances in order. You will need to take stock of what expenses are superfluous, and what expenses are important enough to maintain without a continued income. Making a decision about whether to take out a new life insurance policy, or retain an existing policy, is a necessary component of the retirement planning process. Also key is the understanding that for the most part, the longer you wait to take out an insurance policy, the higher and higher the insurance quotes will climb.

The first thing you need to consider is whether or not you will be able to carry any existing insurance coverage that you may have. You must starting weighing these options many years before retirement, because whether or not you currently have a life insurance policy, you will need to make sure that you carry that coverage continuously for at least five years before you retire, or you might not be able to extend the coverage. Among other factors, this sobering requirement should remind that your retirement is not a decision that should be taken suddenly or without proper planning.

If you are not currently insured, you need to think about the benefits and drawbacks of taking out a policy. This will require a thorough evaluation of not only the circumstances and financial obligations of your own life, but of those around you, especially dependents. Life insurance policies are not always necessary for those approaching retirement, but when they are, you face the prospect of leaving loved ones and dependents behind without financial security. When considering whether or not to take out a policy, evalaute the entire situation carefully. Professional help is often available through personnel offices and human resource departments that are equipped to answer frequently asked questions about retirement and life insurance.

What are some of the situations that would lead to the necessity of taking out a life insurance policy when approaching retirement? Your own financial circumstances are, of course, one of the keys. If there's not enough money for proper burial, which can cost several thousands of dollars, it could be a devastating expense for the loved ones you leave behind. Also of importance are unpaid mortgages, outstanding medical bills, and credit card debt. Before you retire, these affairs need to be in order. Next, consider who you are leaving behind, and if they are dependents whose financial need without your assistance would be crippling. Although not everyone who retires needs life insurance, if you find yourself echoing these concerns, you should look into a policy.

Taking out a life insurance policy is a serious financial decision and should be done with proper concern. Weighing your insurance quote options carefully is important toward making your final decision. And, as stated above, the longer you wait, the more likely life insurance quotes will rise due to your advancing age. The faster you act, the more secure you and will family will be. Visit Insure.com for the best life insurance available today.

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Retirement Planning - Start Now - Save More - Retire Rich
By Shweta Misra

Retirement planning ensures that you will continue to earn a satisfying income and enjoy a comfortable lifestyle, even when you are no longer working. An increasing number of young Indian professionals are moving away from the traditional joint family structure. Since support no longer comes easily, parents have realized the need to provide for themselves during their retirement years.

Until recently, many young Indians in there 20s and 30s were ignorant towards retirement planning and were not taking it seriously. For them, retirement was some thing that was too distant.

However, smart advertisement campaigns by private life insurance companies like ICICI Prudential's "Retire from Work, not from Life", HDFC Standard's "Retire with Pride, Live with Self Respect", and more recent one from Ageon Religare "How much pension will you need? Know your Correct Pension amount." have helped in increasing the awareness about retirement planning.

Your retirement planning does not end once you have taken a retirement plan from any of these Insurance Companies. Its just a beginning, and if you start at an early age it is extremely helpful. Still wondering why do you need a retirement plan? Here are some of the reasons :

Inflation: Due to inflation, value of money keep decreasing year-on-year, so the value of Rs.100 five years ago was much higher than the value of Rs.100 today. As you need to worry about it, you also need to account for inflation adjusted returns on your investments, while planning for your retirement.
Increasing Life expectancy: Increased longevity has been the greatest single benefit to Indian citizens since independence, a benefit spread across all states and income levels. The life expectancy, as on 2007, for males at birth is 67 years and 71 years for females. The globalization of modern medicine and medical practices has globalised high life expectancy too. With advancement in medical technology life expectancy is likely to increase. Result: You will have to fend for more number of years post retirement.
Medical emergencies: With age come health problems. With health problems, come medical expenditure which may make a huge dent in your income post retirement. Failure here could lead you to liquidate (sell) your assets in order to meet such expenses. Remember medical insurance do not always suffice.
Changing Social Structure: The culture of joint family is changing. Today, an increasing number of young Indians are staying away from their families due to employment. Hence people have to develop a corpus to last them through their retirement without any help from family.
Absence of Government sponsored pension plan: Unlike the US and UK where they have Roth IRA and state pension respectively as social security benefit during retirement, the government of India does not provide such benefits. Only 4% of India working population- mostly government employees - are covered by pensions. The remaining 96% comprises self-employed and salaried professionals who do not have a formal, mandated provision for pensions.
Job hopping: With youngsters hopping jobs regularly they are unable to get any substantial benefit of plans like super annuity and gratuity. As both these plans require certain number of working years spent in the service of a particular employer.

There's no easier way to begin retirement planning than by saving through a workplace retirement accounts like Employee Provident Fund and Family Pension Fund and diversify it, on your own, by taking adequate insurance cover and investing in a mix of asset classes.

Start now, Save more, Retire rich.

Shweta is Co-Founder of Personal Finance Blog that provides expert advice on Money Management, Financial Planning, Investment, Insurance, Loans and Personal Wealth Management to effectively manage your personal money.

For more articles on Personal Finance, please go to PersonalMoney.in

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Update Sept. 13 2009 Retirement Planning By Insurance Experts

2009-09-13T07:33:00.000-07:00

No matter what kind of life you hope to live when you have finally become old and gray, you still need retirement planning services. Grab the opportunity to save some money especially if you are currently enjoying a high paying job. If you would always bear in mind your financial plan and start saving money for it, you might just have the kind of retirement you hope to have.

While planning for your retirement, you might realize that you need to avail of the retirement planning services so that you would be able to plan your retirement and scrutinize every detail, especially about the financial matters. To gain access to a detailed financial plan, you need to confide the long term financial objectives which you are considering to your retirement planning consultant. The latter should be able to direct you in the evaluation of your present financial status. The consultant should also be able to come up with a financial plan which will help you achieve your retirement goals. Before he helps you to achieve your goal, he must, first and foremost, be able to make you recognize and identify the financial goals which you should consider for your retirement. If you are only capable of making a small investment, you may make use of certain instruments which will aid you to attain your objectives.

The company which offers retirement planning services should be trustworthy and should not strip away your right to decide what goals should be set. It should also put into consideration not just your financial status but also your personality and preferences. Do not choose a company which will force you to make decisions which you do not like. Also remember that if you choose the company which will be able to clarify the details before you make decisions and offer you some satisfactory financial plans, you will be rest assured that your investment is in good hands.

Please visit Gilbert Guide for more information on retirement planning services and retirement.

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Strategic Retirement Planning Guarantees a Woman's Future
By Amanda E Clark

If you are reading this article, the current economy probably has you a little worried about your future. If you are a woman and you are concerned about retirement planning you must know that it is never too late to take an interest in planning your financial future. Regardless if you are single, married, divorced or widowed, it is imperative that you know how you are going to live when you retire.

There are many retirement planning tools available to you on the internet when you begin or continue to plan for your retirement. One of the most important things as a woman that you need to remember is that you should never attempt this on your own and you should always consult with someone who has both your best interests at heart and holds your trust.

Be Smart Before You Retire and Live Well!

Even if retirement seems like a long way into the future, it is important that if you have not started planning for your golden years, that you start today, as in right now. Women of all ages consistently do not plan enough or do not plan properly for their retirement. In fact, a staggering statistic reads that of the sixty-two million wage and salaried women workers in the United States between the ages of 21 and 64, less than half, only forty five percent actually choose to participate in a retirement plan at work if it is offered to them. What needs to be focused on here is the fact that between women and men, it is women who have the longer life spans! So how are you going to take care of yourself, if there is no one else to do so?

There is no good excuse to not think of your future or to believe that someone else other than you should be responsible for your retirement planning.

Take Charge and Celebrate Your Independence!

Finally, always realize that there are retirement planning professionals out there who have your best interests as a woman at heart and want to help you take charge of your future. Studies show that when a woman consults a retirement planning professional to speak about retirement planning that the chances of being able to have enough money for their retirement significantly increases.

In addition, it is incredibly important for you as a woman to consult with a professional on retirement planning to understand how you will be affected financially if you are divorced or widowed. There are many ways to protect your interests and your assets if you find yourself alone.

Retirement planning is not a subject that is strictly for men. As an educated woman, you must understand that you have to be responsible for your own retirement planning and take charge of your financial future.

http://www.calipearl.com

Retirement Planning - Start Early & Enjoy Financial Independence
By Carole Dople

Everyone retires one day so the earlier you start your retirement planning, the better for your future. It really does not matter whether you would be retiring in the next 5 years or the next 20, start planning now. That would definitely improve your financial future.

The Need for Retirement Planning
People think of ideal retirement as a combination of leisure activities, financial independence and luxury vacations - all these things are possible only if you have enough money when you retire. To live a comfortable life after you retire, you need financial planning. There are many tools and resources available to help you plan better.

The Basic Steps Of Retirement Planning
* How much money would you need after you retire? - This is dependent on your current standard of living. You need to estimate what your annual expenses will be after you retire. One point to be taken into consideration for this estimation is the difference between the current expenses and retirement expenses. For example, right now a large percentage of your income goes towards your house mortgage and children's education. But by the time you retire, your children must have settled with their jobs and you would have a home of your own. When you retire, you and your spouse may have increased medical expenses and you would also like to spend money on vacations. Here, you also need to consider inflation. The average inflation rate is around 3%.

* How much would you need to save? - After you calculate the inflow that may come from part time income, interest on the savings and Social Security; you need to estimate the exact value that your assets will have and the income you will earn after you retire. By calculating this, you would come to know the shortfall. Here, there are many factors that need to be considered. At what age you are planning to retire, the number of years you are going to live (depends upon your health) and the return on your current investment. The first two factors roughly determine the number of years of your retirement. While calculating the rate of interest on your investment, take a conservative call and calculate the return based on around 5 to 6 percent. This would enable you to calculate the amount of money you require to save after you retire.

* How to build the retirement corpus? - Once you have determined the amount of money needed to be save each month from now till your retirement, the next step is to find a plan that is just right for your savings needs. Ideally, you should arrange for a specific amount that is directly taken from your monthly paycheck and automatically invested in the financial plan of your choice. This type of arrangement would reduce your impulsive spending habits. You can opt for payroll deduction savings plan or 401(k) plans.

For the perfect financial planning, you need to understand the different savings and investment options that are available to you. This definitely requires a lot of dedication on your part. If you are busy and can not find enough time or do not quite understand the intricacies of various investment plans then it is advisable to hire a financial advisor, to take care of your retirement planning needs. Financial security after you retire is important - you must start planning for it now.

Financial planning is very important if you want to ensure a wealthy retirement for yourself. Free Retirement Membership is an online retirement planning that promotes retirement information.

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Update Augaust 13 2009 Retirement Planning By Insurance Experts

2009-08-13T04:58:00.000-07:00

"The way to get started is to stop talking and start doing."- Walt Disney

The Time for planning for your future is now but in today's fast paced, hectic world many people put off important decisions until another day. The excuses, "I don't have time to plan", "I can't afford to invest", and "I really don't understand" will jeopardize your achievement of your financial goals. The truth is you shouldn't delay. The earlier you start, the more you can maximize the power of time to help realize your retirement goals. Unfortunately, as I've told you before, one of the misconceptions is that you don't have to start planning until a year or so before you actually retire. Sure, you may have been saving for your retirement for many years, but have you really been planning? American research suggests that people who take the time to plan ahead end up with more resources when they are ready to retire.

Once you know your basic goals-your retirement age, the type of lifestyle you want, and how much income you'll need-you can create a plan to achieve them. If you wait until the last minute, you won't have time to make up the potential gap between expenses and retirement income. This gap is certainly one that most Bahamians can expect to face as a result of your saving and investing habits coupled with the lack of National Insurance resources to fund expected retirement benefits. Another misconception is that your employer or your human resources department at work will give you all the information you need to make your financial plans for retirement. Therefore, most persons wait for their employer to initiate the retirement planning process. Unfortunately, your employer is not required by law to provide you with a pension or information about pension. Fortunately, a number of employers have provided their employees with a pension plan. However, these plans are only required to provide you with basic information -such as the date when you will become eligible to receive a pension, how much you will receive if you retire on different dates, and the options for withdrawing money out of your account. But your employer has no obligation to educate you about other important retirement topics such as Retirement planning, National Insurance benefit entitlements, or Life and Medical Insurance needs during retirement.

To develop a complete picture, you either need to spend time reading and informing yourself, or find and work with a retirement coach you can trust.

Time is definitely an ally when you're saving and investing for long-term goals. Let's consider the difference an early start can make: If you invest $2,000 a year from age 25 to 35, earning a 6% annual return, at age 65, you'll have more than $200,000.

If you invest $2,000 a year from age 35 to 65, earning the same 6% annual return, at age 65, you'll have only $150,000.

As you can see, an early start would let you maximize the benefits of compound interest, even if you stopped saving after age 35. So you see that by waiting just 10 years to get started could cost you more than $50,000 in investment returns.

Procrastination can be the difference between financial success and financial failure. Let's look at another example: if we assume you have $50,000 to invest at 7% compound interest.

Let's compare investing immediately or waiting 10 years.

In 20 years, if you start today your $50,000 will grow to $193,484
If you waited 10 years, your $50,000 will grow to $98,358.

Here, waiting ten years will cost you almost $100,000.00 of investment returns.

When you have a plan and you are able to invest systematically, you can take advantage of compounding interest. The power of compounding interest cannot be overstated. When you save and invest, compounding interest works in your favour, helping you to build the savings you need for future financial goals. But to maximize the benefit of compounding interest you must get an early start. The sooner you begin planning and saving, the more your money will grow.

The rate at which your retirement investment is able to grow plays a key role in determining the amount of income you will have when you stop working. However, when you add the advantage of compounding to the formula, your retirement dollars can grow even faster. Compounding is the growth that is computed, based on the sum of the original investment plus already accrued earnings. Simply put, your investment grows at an accelerated pace as your money makes money. Secondly, you must invest for the long-term. This keeps your money working-and compounding-for you. With the power of compounding, a relatively small amount could add up to big savings over the long term. Let's say you have an initial investment of $10,000 at annual rates of return of 6% and 10%, compounded annually over a 20-year period. Over a 20-year period, $10,000 grows to over $30,000 at 6%, and nearly $70,000 at a 10% growth rate. That's letting your money work for you!

To read more article like this and to get help to painlessly take control of your money to create wealth for you and your family go to http://financialcoachingwithglenn.com

Article Source: http://EzineArticles.com/?expert=Glenn_Ferguson

Will I Need Life Insurance When I Retire?
By William T. Tyler

There are many uses for life insurance. When a person is young, this type of insurance can protect a family from financial ruin should the main income earner die an untimely death. It can also be used as a savings tool to save money for long term future endeavors. Depending on each individual person's financial planning, he or she may still need this insurance during retirement.

While some life insurance could be needed, large amounts will probably not be necessary. This is because as a person ages, his or her debt and financially responsibility generally decline. However, one may still wish to leave a legacy behind to either loved ones or to an organization or charity of choice. Some people keep their life insurance policy so that when they die, their children will receive an inheritance. This "inheritance planning" is a great method because benefits from life insurance policies are not taxed for income nor is they subject to estate tax. This benefit alone appeals to some people if it was properly explained when they got their life-insurance quotes.

Another similar reason for keeping this type of insurance during retirement is if one started a universal-life insurance policy early in life. This type of whole-life insurance gains cash value throughout the years it is in force. Then when retirement comes, there are often no premium payments to be made and it can actually pay the insured. Insurance policies can be set up similar to an annuity in that the insured can withdraw a set amount of money from the cash value built up in the policy. In doing so they are able to supplement their income, with any penalties or fees. And depending on how the life insurance policy, it will not reduce the death benefit, should that person pass away. In retirement, this is a great option because a person can get back some of the money they paid in premiums through the cash value the policy has earned, but still serve its purpose of a life policy with a financial benefit to those left behind.

Finally, a person who did not get life-insurance early enough in life can still get a small policy as they approach retirement. Obtaining a life-insurance quote for a final expense policy will probably be the most affordable policy option, since life insurance dramatically increases in cost as a person ages. A final expense policy is a small $5,000 to $10,000 policy that is designed to help offset the ever growing cost of a funeral. These small policies normally do not require a lot of underwriting, such as a doctor's exam, and they are meant to make sure family and loved ones do not incur debt for a funeral. If a person has sufficient money saved to cover such cost, then an insurance policy would not be needed.

Life-insurance is not needed in retirement by standard conceptions, nevertheless, if people have life insurance policies it will only benefit those they love and possibly even themselves. Life-insurance has many different uses than to just pay off debts. Each person must look at what they want out of life for themselves and for their loved ones. Then he or she should make an appointment with an experienced, licensed insurance agent who can guide them through some life insurance quotes and assist them in finding one to best match their needs. This process is best done early in life though, as it becomes harder and more expensive to obtain the older a person gets.

In today's economy, finding the best life insurance that fits your budget is important. Visit Insure.com for the best life insurance quotes available today.

Article Source: http://EzineArticles.com/?expert=William_T._Tyler

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2009-08-04T10:09:00.000-07:00

Building Your Nest Egg - Learn How Money Works
By Anthony Moschetti

After a long career working in the technical field and some years as a musician, I became involved with a rather unconventional insurance and financial company. Their focus was to teach people everything banks and insurance companies didn't want you to know. I became licensed to sell life insurance and mutual funds. Much of our business was from people who had bundled insurance products.

The only life insurance product we sold was term life insurance. Our only investment products was mutual funds. The company motto was buy term and invest the difference. After many years I had finally became exposed to knowledge of how money works. Before I gained this knowledge, I had worked for seventeen years with a very good company. Due to my lack of knowledge about how money worked, I got nowhere near the return I should have from my 401K. Here is a review of some of what I learned and what every one should know.

The first thing you need to know is how invested money grows. There is a simple rule of thumb called the rule of 72. Divide 72 by the rate of interest and you will find how many years it takes your money to double. At the bank these days you are lucky if you can get 2% on a savings account. If you divide 72 by 2 you get 36. In 36 years $1000 will become $2000. Divide 72 by 12 and you get 6. In 36 years $1000 will double six times and becomes $64,000. Give it 12 more years to 48 years and it becomes $256,000. As you can see, time is an essential ingredient in this formula for financial success.

Are there places to get 12% return on an investment? Over the short term no. However, with all the ups and downs in the economy, including the great depression and the many recessions, over a fifty year period there are investments that have returned 12% or better. These results have been achieved by investing in the stock market. Honest financial people have to tell you that past performance is no guarantee of future performance. In other words, history may not repeat itself.

Maybe fifty years from now, governments will collapse and there will be no viable economic future. Maybe the world will end from global warming or be hit by an asteroid. We have to trust that there will be a future and the economy will grow. One thing is certain. If you don't save you will die broke. Second, Most people waste many $1000 in their life times. Why not put a few of those $1000's to work for your future. Let's look a what you need to know to have success in the stock market.

One thing, you need is diversification. The best way to do this is through mutual funds. Through mutual funds, you can invest in thousands of companies. You can also diversify across risk levels by choosing funds with different objectives. For less than $100 a month you can begin investing. You also need to invest long term. Even experts trading in and out of the market often lose.

Mutual funds have restrictions on excessive trading. The best way to invest long term is to use dollar cost averaging. What you do is invest a fixed amount, weekly or monthly. When the market is up, you buy fewer shares. When the market is down, you buy more shares. In the long run, when a market goes down and up, you make more money than in a market that keeps going up.

The final point I will make is control expenses. Every dollar that goes into expenses is a dollar that doesn't get invested. Insurance companies love to sell bundled life insurance products. What you are getting is life insurance plus a cash building investment. These can be anything from low yielding savings to investments in the stock market. The problem is there are usually high up front charges and hidden expenses. The other problem is that if you are a young family, you need all the life insurance that you can get.

You need to buy lot's of cheap term insurance. When you are older, children are grown and you don't need life insurance you need money for retirement. You only need life insurance in proportion to the responsibility you have to others. The idea of a bundled policy is to give you cash value as you become older and less insurable. You can accomplish this better by buying term and investing the difference. Investing through 401k's with a company match, tax deferred Ira's, and low cost indexed funds are some of the best ways to go.

All my life I've been a seeker after knowledge. I've worked in science, music, the financial field and spent many years as a member of a public speaking organization. It was while working in the financial field that I became aware of the basic principles of how money works. I am an avid reader of non fiction books on many different topics. I have a knowledge web site. It's purpose is to share knowledge. Right now it has an extensive music section, some pages on how money works, and a book review section.

http://tonyknows.com/money

Article Source: http://EzineArticles.com/?expert=Anthony_Moschetti

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Retirement Planning - Is Long-Term Care Insurance Necessary For Baby Boomers?
By David Skill

Many people think wealth creation is what enables people to retire with confidence. In reality, what makes people confident in retirement is knowledge they have planned well for life's contingencies. Until you have an adequate plan for inflation, healthcare expenses, life expectancy, etc. etc. you can not really assess how much wealth you really need.

Long-Term Care Insurance is a difficult contingency to plan for because it's expensive, you are never sure if you will need it and in final analysis it may not make sense to own it.

Long-Term Care Insurance is for individuals who have lost their ability to live independently. This could be because of a disability or a prolonged illness (mental or physical). The insurance covers people that need help to carry out the six activities of daily living, which are dressing, bathing, toileting, continence, transferring (move from place to place) and eating. Typically you need to lose the ability to perform two of these six before coverage starts.

The average cost of a nursing home is $70,000 - $80,000 per year. Since it is so expensive, everyone should consider long-term care insurance as part of the retirement planning process. That is not to say everyone should buy it.

Here are three reasons to consider long-term care insurance:

Protect your assets: With this insurance you can avoid having to depend on other family members for your physical and financial well-being.

Medicare is not a solution: The cost of long-term care (without insurance) can wipe out your net worth in a hurry. Medicare is not allowed to be a long-term solution. Medicaid is an option but you only qualify for Medicaid once your assets dwindle to almost zero.

Act before health problems surface: The best time to buy long-term care is in your late 50's or very early 60's before premiums get too high or health problems keep you from qualifying.

Before you commit consider these statistics:

Sixty-Six percent of people will never enter a nursing home facility. There is a good chance you will never need the insurance you paid for.

Only nine percent of the people that enter a nursing home will stay more than five years. You need to determine if you think you can self fund this expense.

Eighty-Eight percent of the people entering a nursing home are at least 70 years old. Once someone enters a facility, only twenty-five percent return home.

If you draw conclusions from the above statistics you would conclude that you will probably never enter a home. If you do it will be after age 70, but your stay will be less than five years and it is unlikely you will return home. It would be reasonable to assume that self-funding would cost $250,000 in today's dollars and you could expect that figure to double in the next 10-15 years.

If you have a high net worth (greater than $1 million) you should consider self-funding. Once you are in a nursing home your expenses drop considerably in most categories. If you have a spouse you need to consider their ongoing expenses as well. All this needs to be weighted against premiums of $1,000-$2,000 per year depending on your age.

When you consider long-term insurance be sure you understand how long coverage lasts, how much money is paid per day and will that amount increase with inflation. Make sure the insurance company is solid (preferably AAA rated) and understand if the coverage is for more than nursing home care. Know how long you have to wait to receive coverage and are the paid premiums refundable at death if you did not use that amount as benefits.

Any decision with this many variables is difficult. This is a personal decision based on your own unique situation. If you spend time adequate time evaluating your options you will most likely make a smart, informed decision for your family... Good Luck.

David Skill, a 'Chartered Retirement Planning Counselor' has created an easy retirement system that enables conscientious baby boomers to determine how much money they need to retire. David asks all the vital questions, uses common language and plenty of examples so the participant builds confidence their money will last through retirement and they will not burden their children. Check out >>>>>>>>> http://babyboomerseasyretirement.com/

Article Source: http://EzineArticles.com/?expert=David_Skill

Life Insurance For Parents
By Thomas Corley

On 9/11 two families I knew from my swim club lost their husband/father. There aren't enough adjectives to describe the emotions we all felt not only for those poor, young families. There was, however, also a sense that many of us (the members) dodged a bullet, for it could have been any one of us who lost a family member. I remember telling my wife, shortly after 9/11, that I was just sitting in a seminar in the towers two weeks before. My friend had a 9 a.m. business meeting in the towers the week before. Another friend had to cancel a meeting on 9/11 for personal reasons. Any one of us could have been "them".

So where are these struggling families now? Every summer I still see them at the swim club. The kids are getting bigger. They run around with my kids and my friends' kids, smiling and laughing and living. I see the mothers at various little parties at the Tikki Bar, drinking and laughing and living. Their lives are certainly different. Their Dads are missing from the picture. But there they are living the same lifestyle they had before 9/11.

How is this possible? Life insurance. Each of the fathers was smart. Very smart. Why? They believed in life insurance. They were not like most people who see life insurance as an expense, a product to be sold to them by some aggressive, commission-seeking life insurance agent. The see life insurance for what it really is, a deferred asset. These two, smart, husbands and fathers were not satisfied with the meager life insurance their employers provided. They sat down with an insurance professional and, together, determined how much life insurance they needed in order for their families to live the same exact lifestyle in the event of their death.

This isn't an illustration, this is reality. When someone dies the thought that races through the minds of many individuals is that it won't happen to me. It only happens to the other person. Well to me you are the other person. People die. Fathers die. Mothers die. It happens every day of every week of every month. When one of the individual's who dies is a breadwinner the effects upon the family are compounded if there is not adequate life insurance. If you are a parent and you don't have adequate life insurance you are being negligent and uncaring. Life insurance is a must have for all parents.

How much is enough? As a financial professional I use the following formula to determine how much is enough for my clients:

Gross annual compensation lost as a result of death divided by 5%

Example: Joe and Jean Smart are married with three small kids. Joe makes $80,000 a year and Jean makes $20,000, working part time. Joe has $200,000 in life insurance provided to him by his employer. Jean has none. Both come to see me to find out how much life insurance they need. I go through the above formula: $80,000 divided by 5% = $1,600,000 minus $200,000 = $1,400,000. If Jean dies, the family will need $400,000 to replace her lost wages.

Why the 5%? If you were to invest Joe's $1,600,000 into a relatively conservative investment that generates 5% interest it will produce $80,000 of income. If you were to invest Jean's $400,000 into the same investment it will generate $20,000 in income. Financially, the family is secure.

Some may look at this simple illustration and argue that they could cut their insurance need in half and use some of the principle. Well, if you did that, in 14 years you would be out of money. What if you reduce your need to $1 million, and use the principle? In 20 years you would be out of money. You see, there is no way of making the case for using the principle to fund your lifestyle if you plan on living for a long time. Eventually you will run out of money. The only way to insure your financial future is to determine how much income you need to replace and obtain an amount of insurance to help fund an investment to generate the income you need.

There are two types of insurance: Term and Permanent. Term insurance is pure insurance. You pay for the death benefit and that is all. Term expires every year and must be renewed every year. Term is the cheapest type of insurance available. Permanent insurance is a combination of death benefit and investment. The premiums are higher and the reason for this is that part of the premium is used to create some type of investment return, known as cash surrender value. This cash surrender value builds up over time and can be used to pay the premiums down the road. Thus, it is permanent. Which type should you own? In my opinion everyone should have a combination of term insurance and permanent insurance. The term coverage should represent about 70-75% of your total insurance coverage and the permanent the rest. The reason for this is that as you get closer to retirement age, term will be too expensive to maintain any longer. The permanent insurance cash surrender value can then be used to help provide some supplemental income in the form of borrowing from your built-up cash surrender value, which would be tax free. As you get closer to your retirement years your insurance needs are reduced and the permanent insurance will be there to provide some death benefit for your spouse as well as some supplemental income.

If you have young kids you have an adult responsibility to provide your family with adequate life insurance. It is hard enough on the family, psychologically, when a spouse/parent dies. Don't compound it by further burdening them with financial trauma as well. There is no smooth transition when a loved one is lost, but compounding that loss with the need to sell the home, move into a cheaper neighborhood, uproot the children, just exacerbates the situation. Do the right thing and do it today. Get to an insurance agent and find out how much you need. Listen to them and do not challenge them. They are the professionals. They are there to help. Be a smart and caring parent!

Tom is a Certified Public Accountant, a Certified Financial Planner, CLTC (Certified Long-Term Care) and President of Cerefice & Company, the largest CPA firm in Rahway, New Jersey. Tom works with clients helping them manage their money, retirement planning, college savings, life insurance needs, IRAs and qualified plan rollovers with an eye towards maximizing tax benefits and minimizing taxes. Tom is founder of the Rich Habits Institute and author of "Rich Habits".

Article Source: http://EzineArticles.com/?expert=Thomas_Corley

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2009-08-04T10:07:00.000-07:00

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Early Retirement - 5 Questions You Need to Answer Before Taking the "Package"
By Glenn Ferguson

"Retirement has killed more people than hard work ever will"- A Wise Man

It is not surprising these days to hear about persons' being offered and receiving early retirement packages from employers. This is just one of a number of restructuring and downsizing method used by the corporate world to cut cost. And most recently you saw it used in the restructuring exercise of the Royal Bahamas Police Force.

So whether you are a part of the private or government sector it is something you had better get used to it. And that is why it is so important that you- fully understand what you are getting before accepting an "Early Retirement" package

There is no question that these packages can be quite attractive, and that is the intent of the employer to make it as attractive as possible from a cash in hand prospective but it may or may not be a good choice for you. Hopefully, once you are done reading you will be empowered to look carefully at what you are getting before accepting, even if you don't have an option to refuse the 'package'.

So what is this all about?

An early retirement package is an offer of money in return for you retiring at an earlier time than you had planned. Most companies include a severance pay based on your annual salary and your years of service. An early retirement package might also include benefits such as health insurance or life insurance.

Can I afford to this change?

To answer this question, you must have a clear picture of your current financial situation, your family's needs, and whether or not you have enough money to continue living the lifestyle you are accustomed too for the years of early retirement. If you had planned to retire at age 65 and you are now retiring at age 55, will you have enough money to support you for the additional 10 years? Four steps you can take to prepare financially and make the transition less traumatic are:

Eliminate any major debts including mortgage and car payments
Create a peace of mind account to deal with any emergencies
Reduce or eliminate your credit card debt
And practice living on less than you earn.

Do I have appropriate protection?

Your employers may include health insurance in your early retirement package but most don't. And even if it is included you may have to pay the cost. And the cost may force you to get your own coverage. So you need to ensure that you and your family have adequate medical insurance coverage. Your best options maybe an individual medical policy or possibly coverage through your spouse's employment.
You maybe able to continue your life insurance coverage but this is usually very limited and and again you could be responsible for the cost. If your employer doesn't offer life insurance, then it's important that you get your own coverage.

What about my pension?

If your company has a pension plan, you usually can't start drawing from that pension until you reach a certain age but the good thing about this is the longer you wait, the more your monthly benefit check will be. But you should discuss all of your options and entitlements with your company's plan administrator or human resources department.

What about National Insurance?

It is important to note that early retirement benefit payment from National Insurance does not start until age 60. So if you retire earlier than age 60 you will have to wait for this benefit.
Also, if you rejoin the work force after age 60 your weekly salary must be less than $200.00 or monthly $866.67 to continue to receive National Insurance benefits.

What am I going to do?

Apart from all the money issues I feel this is the most important question you will have to answer. You may have been working for 30-40 year now that all coming to an end so what are you going to do. Believe it or not "Retirement has killed more people than hard work ever will." That's why it's so important that you know what you are going to do.

You may not have realized it but besides providing you with financial stability work also provided four other benefits:

an opportunity for you to socialize
a structured and scheduled environment
status or sense of importance
a sense of utility

Now that you will no longer be at work you must find activities to involve yourself in that would provide these benefits.

You can expect that With the current economic conditions that companies will continue to downsize and as a result offer early retirement packages. So start planning now before it happens to you. A helpful resource to help you plan is "Strategies for Achieving A Comfortable Retirement-Your" workbook.

"Retirement is the most expensive purchase you will ever make and it's the one thing you won't be able to borrow money for" - A Wise Man

Glenn Ferguson is a Financial Speaker, Consultant, Coach and Syndicated Writer, helping you to painlessly take control of your money to create wealth for you and your family. Tel: 1-242-327-2453 - Bahamas Tel: 1-501-588-4621- U.S.A. http://investinginyou.org

Article Source: http://EzineArticles.com/?expert=Glenn_Ferguson

Your Remaining Life Expectancy For Retirement Planning
By Shane Flait

How long will you statistically live? You probably think that statistically you'll live to about 75. But that's somewhat of a misconception. Having a better idea on what life expectancy means will help you better project how many years of retirement you need to plan for. And clearing up what life expectancy means to you is what this article is about.

The life expectancy (LE) for people born in the year 1900 was 53. That means the 50% of them will have died by then. Of course, 50% will live longer than 53. Mortality data confirms the LE of past generations. Life expectancy is statistically the '50/50' age that people will live to - as measured from a given starting age!

Today a person born in 2000 is expected to live 77 years - from birth. So 50% of them will live beyond the year 2077. The increase in LE during the past century resulted from improved medical and health care. These life expectancies are based on the whole population.

Life expectancy data includes additional facts beyond age too. Among other things, it keeps track of a person's sex and socioeconomic status. Women born in the year 2000 have a LE of 79.9 while that of men is only 74. Well-off white collar workers will statistically live longer then poorer blue collar workers.

If you watch your life style and health - and just keep living - you increase your remaining LE. And it's your remaining LE that's important for retirement planning. So you're not destined to kick the bucket at the 75 year mark - statistically!

Your remaining LE means you have more years left than you think. That's because life expectancy is based on the age from which you measure years to death. Most often we consider the beginning age as your birth. In that case, a lot of child aged deaths can eat away at the age by which 50% of all will die.

If you start at a higher age, then your expected years to death increases above what you would have expected if you measured mortality from birth. In fact, the older you get, the further beyond your original (i.e. birth-based) life expectancy you're expected to live!

For retirement planning, you should use your remaining LE based on starting at age 65. In that case we keep track of what percent of people who have reached 65 will die at any given older age. So the remaining LE of people who have attained 65 will be the age that 50% of them have died. And that'll be an older age than the life expectancy (from birth) of those who did in fact reach 65.

Insurance statisticians keep track of this extended LE for persons based on their current age. The IRS publishes its own tables on these (for required distributions of IRAs). The IRS calls it 'the life expectancy factor' which is the number of years more you have to live - statistically. You have a 50% chance of outliving these too!

Examples from the IRS table show that a person who is:

Age 60 is expected to live to 85.2 - so 25.2 remaining years to live

Age 65 is expected to live to 86 - so 21 remaining years to live

Age 70 is expected to live to 87 - so 17 remaining years to live

Age 75 is expected to live to 88.4 - so 13.4 remaining years to live

You can see that the older you live, the longer you're statistically expected to live.

In any case, a 65 year old should plan out his retirement years - for investment and income purposes as if he were going to live another 20 years or so - at least. Why? Because that's they way mortality works.

Shane Flait writes and consults on financial, legal, tax, and retirement issues. He gives you workable strategies to accomplish your goals.
Get his FREE report on Managing Your Retirement =>
http://www.easyretirementknowhow.com/FreeReportandSignUp.htm,
You can contact him at contact@easyretirementknowhow.com

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Retirement Planning - The Cost of Waiting
By Glenn Ferguson

"The way to get started is to stop talking and start doing."- Walt Disney

To develop a complete picture, you either need to spend time reading and informing yourself, or find and work with a retirement coach you can trust.

If you invest $2,000 a year from age 35 to 65, earning the same 6% annual return, at age 65, you'll have only $150,000.

Procrastination can be the difference between financial success and financial failure. Let's look at another example: if we assume you have $50,000 to invest at 7% compound interest.

Let's compare investing immediately or waiting 10 years.

In 20 years, if you start today your $50,000 will grow to $193,484
If you waited 10 years, your $50,000 will grow to $98,358.

Here, waiting ten years will cost you almost $100,000.00 of investment returns.

To read more article like this and to get help to painlessly take control of your money to create wealth for you and your family go to http://financialcoachingwithglenn.com

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2009-08-04T10:05:00.000-07:00

Life Insurance For Retirement - Choosing a Good Plan at Midlife and Beyond
By Marilyn Katz

Many people have life insurance through their workplace, or else they purchased a term life insurance plan that expired when they were middle aged. So now we find people at 50, 65, or even in their 80s, looking for an affordable life insurance plan! Perhaps these people are looking for a good life insurance plan for retirement because their company life insurance will not cover them.

However our need for good coverage does not always go away just because we get older. Sometimes, when we hit midlife, we find that we still have outstanding debts, planned funeral expenses, or people we would like to leave a legacy too. The children, who we had planned on being self supporting by now, may still live at home. Or we may have a business, that we would like to leave to only one of our children. So we know we need to leave our other children, and our spouse, with a legacy to replace the business.

Look at the types of life insurance policies to see how they fit into a retirement plan. Term life insurance is purchased for a span of time, or a term. While it is still widely available in our 50s, the older we get, the harder it is to get a company to issue a term plan. I have seen companies that will issue ten year term policies up to age 70, but the applicant must be fairly healthy. By the time many people are in their fifties, they can only look at a twenty year term plan, which means it would still expire when the people are in their seventies. As more people live well past 70, those consumers would be left uncovered.

Whole life insurance, that is intended to cover a person for their entire life, is easier to find as we age, and as we develop some health problems. Even though it may be easier to get permanent insurance issued, we find that it is more expensive than the cheap term rates we were used to paying. That is because, of course, whole life insurance means that the insurance company will assume a larger risk. Also whole life insurance builds a cash value which term life insurance does not. So even though whole life insurance costs more, it also lets us build up an asset that could be cashed in or borrowed against if we pass away.

Some life insurance companies will issue whole life insurance policies up to age 85, though they usually will only issue smaller face amounts. These are usually intended to pay for burials and other final expenses. While these policies can be purchased up to age 85, they are much more affordable between age 50 to 60, and so a person would be wise to consider buying them long before any thoughts of funerals come up! Many can even be purchased to be paid off over a span of ten or twenty years, and so they can provide security for the retirement years!

Universal life insurance is another type of life insurance that is purchased to cover a person for the rest of their life. Besides being insurance, many people also consider these plans to be a type of savings and investment vehicle. They can build up cash value, of flexible premiums, and the face value of the policy can even be adjusted. Again, a person would probably want to look at purchasing a universal life insurance plan while they are still young enough to find more affordable rates, though the tax advantages of life insurance can make Universal life insurance attractive at higher premiums.

You can find life insurance for retirement, but the premiums will depend upon your age, how much coverage you want, and if you have developed any serious health conditions. Even people with serious health issues can purchase life insurance, but should probably expect to be satisfied with a lower face value as premiums will be higher.

Learn more about Life Insurance for Retirement and Over 50 Life Insurance.

http://www.247quoteus.com/over50s-life-insurance.html

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The Best IRA Rescue Plan is Not a Traditional Or Roth IRA
By Rocco Beatrice

Roth IRA on Roids is the Better Alternative to the Traditional and Roth IRA

Roth IRA on Roids is like a savings account deposited with an insurance company, rather than a commercial bank, such as Bank of America. It's an improved wealth-building tool. The purpose is to grow your retirement nest egg without taxation and be able to withdraw your savings tax-free, in your sunset years. The benefits of this plan is a wealth building tool which acts like a traditional one but with:

1) No contribution limitations tied to your earned income, marital status, or if you have another pension plan in your business or with your employer.
i) Both, the Traditional and regular are limited to $5,000 or $6,000 if you're over the age of 50. With Roth on Roids™ you can contribute $10,000, $20,000, $50,000, $200,000 or more. The only qualification is that you must be healthy.
ii) There are no earned income, marital status limitations, or age limitations.

2) No early withdrawals penalties or sur-tax based on your age 59 1/2 or forced distributions after your age 70 1/2. You decide when to begin withdrawals from your savings, without restrictions. Of course the longer you delay your retirement, the better the numbers.

3) No risk of loss with the violent ups and downs of the stock market, the real estate market, commodity market, or any other market. Your principal is guaranteed by the insurance company with a minimum guaranteed tax-free return on your deposit.

In 2008 did you lose money in the market with your IRA account? Are you afraid to put your money back in the market? With Roth on ROIDS™ you get a guaranteed tax-free minimum return of 2 percent, and typical but not guaranteed annual tax-free returns of 5 to 9 percent, translating equivalent taxable returns of 8 to 15 percent assuming a 40 percent tax rate.

How does this work? Is it legal?

Absolutely. It works because your savings account is deposited with an insurance company, rather than a commercial bank, such as Bank of America.

This savings account is technically "wrapped" by an insurance policy. Insurance companies do not pay income or capital gains taxes on insurance policy returns - and neither will you. As a bonus of having your savings account wrapped by an insurance policy, you get a death benefit included at no additional cost.

1) It is a tax-free wealth building savings account wrapped in a life insurance policy. If you die prematurely, your family will receive a death benefit.
i) The Traditional and regular will never own a life insurance policy; it's one of the restrictions. It has no limitations. In fact, it's a savings account wrapped inside a life insurance policy designed for tax-free growth and tax-free withdrawals.

Example: At age 52, Dr. Smith contributes to his wealth building of $50,000 for 7 years, for a total $350,000. Beginning his age 65 Dr. Smith begins to withdraw $30,455 per year for 35 years or a total $1,065,925. His death benefit beginning at age 52 to his age 65 is $1,249,976 then is steadily reduced by his withdrawal of $30,455 representing his policy loans against his death benefit.

IRA conversion: My Accountant has been talking to me about converting my Traditional IRA to a Roth, can I use Roth on Roids™ as the alternative tool?

Yes. If your accountant, financial planner, investment advisor, lawyer, or other professional advisor has discussed converting your money or other "qualified" retirement money to a regular by paying the tax now and repositioning your money to this account, you should strongly consider the third tax-free bucket, wealth building tool.

1) It has all the similarities of a regular Roth without the restrictions.
2) Contributions are after tax, tax-free growth, tax-free distribution, and can be passed on tax-free of inheritance taxes.
3) Noteworthy difference between a regular Roth and Roth on Roids™: Death benefit. (You cannot buy life insurance within a Traditional and a regular).

How much does it cost to set this 'third bucket' account up?
There are no fees associated with this account.

How can I finance this account, the third bucket, wealth building tool?

1) Cash or investment dollars.

2) By repositioning your home equity.
i) You borrow from your equity to reposition other people's money by buying the third bucket.

3) By repositioning your Commercial Real Estate Equity.

4) If you have lost your money in the stock-market? Is it fair to say that you are scared to invest in the stock market today? You can strategically place some of your money in the third bucket by eliminating the risk of losing your money. Risk management by allocating amongst classes of assets.

5) If your tax adviser, investment banker, financial planner, or other professional is talking to you about conversion to a regular by paying the tax now and reinvesting it into the account, the third bucket is the better way to go. This third bucket is not under the control of IRS mandated restrictions.

Best IRA Rescue provides services on your Roth IRA, IRA investments & traditional IRA and will help you reduce your inherited and beneficiary independent retirement account taxes in your estate assets. Roth on ROID™ is your advanced Roth IRA retirement planning strategy. It is Cash Value Life Insurance and one of the best IRA tax-savings strategies with benefits of a guaranteed death benefit, guaranteed principal, tax-free growth, and tax-free distributions from policy loans. Traditional IRAs and ROTH IRAs cannot invest in life insurance. Please contact us if you have any questions. Rocco Beatrice, CPA, MST, MBA
Best IRA Rescue-Roth IRA
Other article: What's Better Roth 401K Contribution Limits
Boston, MA: 71 Commercial Street #150 Boston, MA 02109
Costa Mesa, CA: 543 Victoria Ste. J, Costa Mesa, CA 92627
toll-free: 888-93ULTRA (888-938-5872) tel: +1.508.429.0011 fax: +1.508.429.3034

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Life Insurance After Retirement
By Marilyn Katz

Most of us thought we only needed to buy a big term life insurance policy when we were starting out in our adult life. We wanted to protect our kids and spouses if we should pass away. We probably had big mortgages to cover, and we also had plans for our children's education. The policy would expire after a few decades, but that was alright, because we planned to have our obligations taken care of in that time, and we planned to outgrow our need for coverage. However things did not always work out like we planned, and now, in middle age or retirement years, we find that we could still use a life insurance policy.

The good news is that people are expected to live longer, even longer than they did a decade ago. Since we did live long enough for our term policies to expire, we can expect to live even longer! However, we may not have outlived our need for coverage. Top insurers recognize that, since people are living and working longer, they may still need to buy policies at older ages. Rates have dropped, and insurers are developing more policies that can be issued to older people.

A 65 year old in decent health can still buy term. They may not be able to find a 30 year term policy, but they can find 10 year policies at affordable rates. Maybe that extra 10 years will be enough to pay off an extended mortgage or get the kids out of the house. Many term policies do not even require a medical exam, but requirements vary, based on the age and health of the applicant, and also the amount of life insurance applied for. Actually, if you are in good health, you may find lower premiums if you take the time to have a medical exam.

If an older person has some more serious health issues, or wants to have coverage that will not expire, they can consider a whole life insurance policy. Sometimes these are called final expense policies, and they are designed to be issued to almost all older people, sometimes up to 85 years of age! Simplified issue policies only ask a few health questions, and can usually accept any applicants who are not terminally ill and who do not need to live in a nursing home. Guaranteed issue policies accept everybody who can pay the premium, though they usually cost a bit more for the same coverage as simplified issue policies. Another problem with guaranteed issue policies is that they usually have a waiting period before the full death benefit will be paid. Sometimes the waiting period is 2 or 3 years, and that is used instead of health underwriting to qualify applicants. So, if you are considering a senior life policy, try to qualify for simplified issue instead of guaranteed issue if you can. But guaranteed issue policies usually refund all premiums paid with interest even if the waiting period has not been satisfied. So, for an older person who cannot find any other insurance, it is still a good deal.

Find Life Insurance Over 65 with our fast, safe, and free life insurance quote forms.

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All About Life Insurance and Retirement Planning

2009-08-04T10:03:00.000-07:00

When you retire and start receiving social security, you hope to have enough money to live comfortably without having to worry about how to make your mortgage payments or pay for your prescriptions. After all, you've spent most of your life working hard just so you can enjoy the last years of your life.

The unfortunate reality is that only about 3% of 65 year old people are financially secure. Most of them live from one social security check to the next. They have little savings. They have no additional sources of income. Basically if something happened to this check, most seniors would be devastated.

Of course, the story gets worse because something is very likely to happen to their social security check and there's nothing they can do to prevent it. We're not talking about changes to how social security is funded or anything political; we're talking about the inevitable death of a spouse. When the spouse dies, this income is going to change drastically. For seniors who are already struggling on a fixed income, any change in that income is going to have serious ramifications.

Most seniors realize this. They know their social security benefits won't be enough to protect them when their spouse passes away. Sadly, they often realize this too late. When senior citizens try to take out insurance policies to cover their entire remaining mortgage, for example, they are usually denied because the risks to the insurance underwriter on such a policy would just be too overwhelming. Basically, if they haven't planned ahead when it comes to insurance then by the time they are on social security they will find getting a large amount of coverage extremely difficult.

The good news is that even social security recipients can still take out some life insurance, although the amounts are limited and they will still need to be in good health to be approved. One recommendation is for seniors to take out enough insurance to cover 2 to 3 years worth of mortgage payments because this money will help their surviving spouse be able to keep the home, cover the costs, and buy some time while he or she decides what to do next.

Basically, the plight of so many people who are 65 and over should teach all of us an important lesson about planning ahead. If you take out a permanent insurance policy when you're in your early thirties, you and your spouse will be protected even when you're both receiving social security. This will eliminate some of the concerns about what will happen to your financial stability when the other one passes away.

And now I would like to invite you to claim your FREE E-Book: Tips & Tricks That Every Insurance Policy Owner Better Know Or Else! when you visit: http://lifeinsurancetruths.com from Ressonyia Andersen - Renegade Life Insurance Expert & Author of: "When You Love Somebody: The 23.5 Biggest Mistakes to Avoid and Lessons You Must Know About Life Insurance."

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Income Planning, Retirement Planning and Annuity Solutions to Insure You Never Outlive Your Money
By Sandra Skidmore

Some Annuity Owners are positioned to lose a significant portion of their annuity's value to taxes, and most are not even aware of the problem.

The IRS is not required to notify annuity owners about an exemption to the tax code that could save thousands of dollars in income and estate taxes. Below are 10 tips to keep from making huge mistakes.

1. Clearly Define your needs before making your purchase. There are a number of different kinds of annuities available, and each has its own unique features, capabilities and benefits.

2. Have a good grasp of the premium bonuses offered on annuity products. A premium bonus is simply additional interest automatically credited to your annuity's value.

3. Pay attention to the renewal rate offered by your annuity. Following the first year rate, the rate thereafter (known as the renewal rate) may be considerably lower.

4. Avoid tax penalties when exchanging one annuity for another. The 1035 exchange refers to the section of tax code that allows individuals the flexibility to exchange one annuity for another without incurring any immediate tax liabilities.

5. Designating a trust as the owner of your annuity may not be the best solution. It may greatly limit the options and flexibility.

6. Understand the options your beneficiaries have for settlement. A forced income payout plan may provide a legacy that is stretched out over a period of time which may fall closer in line with the wishes of some individuals leaving money behind for children or grandchildren.

7. Stay up to date with all beneficiary designations. One of the more common and costly mistakes made by annuity owners is the failure to update their beneficiary information.

8. Be informed before naming minors as the beneficiaries of your annuity. In many cases, state laws can tie up the proceeds of an annuity if a minor is named as the beneficiary.

9. Annuitization may not be your only option - explore the possibilities. Some newer annuities offer options which allow you to set up a schedule of income that can be adjusted along the way.

10. Be sure to take the minimum distributions required by the Internal Revenue Service. Required Minimum Distributions are the distributions, defined by the Internal Revenue Service, that you must start taking annually from qualified retirement accounts by April 1st of the year following the year you turn age 70 1/2.

For more information on the different types of annuity products available to you, contact the author below.

Author- Sandra Skidmore Retirement Planning Solutions is a Kentucky based company also licensed in IN, OH, VA, and TN. If you live in any of those states, call now for your complimentary, no obligation 16 page booklet on How to Avoid Common Annuity Mistakes. Call 1-866-420-7229 and leave your name and address or a call back number to receive your free Guide or go to our Website at http://www.advanced-retirementplanning.com While you are on our website, feel free to get answers to your questions you may have on other Insurance products such as, Long Term Care, Life Insurance, Income Planning and Retirement Planning.

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All About Life Insurance and Retirement Planning By Insurance Experts

2009-08-04T10:00:00.000-07:00

Financial Planning 101 for Retirement Life
By Natalie Aranda

After fifty years of working, chances are we crave the day when we can retire. We no longer have to wake up at 5 a.m., sit in rush hour traffic, or stress over unrealistic deadlines. These very factors are just the reason why we count down the days to relaxation. While most of us fantasize, the majority of the baby boomers don’t realize that financial planning doesn’t stop at 65. Retirement planning is crucial, regardless of what stage you are in.

It has always been a common myth that people do not have to save for their retirement until they have sent their children to college and have time to rest. This could not be further from the truth, as it is important to always plan ahead, even if it means starting in your 20’s. Unfortunately, we never know what is going to be around the corner. Due to health problems or other issues, we may have to retire sooner than we think. Thus we must save steadily incase a financial burden is forced upon us.

The first thing you need to do is think of financial planning. Retirement planning is not easy, but it is possible if you create a budget for your living expenses. After all, the more money you save each month, the more luxury you will be able to have once you stop working! You must stay informed and know every alternative that can be offered to you. Most companies offer retirement packages or a certain percentage of salary to go straight into a retirement fund. This is a wonderful opportunity if you can do it, because it helps you build upon your retirement planning package.

If you are doing it on your own, you must make sure that you create realistic goals for yourself. For instance, if your two children are going off to college in a year, and you want to save 50% of your paycheck for retirement, chances are this is not going to happen. You have to make a list of your top priorities and put money aside for each one. Although your children’s college education may require more money for four years, you can assume that you’ll be able to spend the rest of your salary on retirement planning once they have graduated.

Another alternative is life insurance settlements. Many people end up wanting to get rid of these policies due to an illness or a financial burden. Through life settlements, one can actually sell their insurance plan to a third party. By doing this, the person acquires a large amount of money, and they are no longer connected to their life insurance. If you are in need of extra money, many people feel that life insurance settlements are beneficial.

When we start to get older, we automatically get worried about our futures. With no steady income after the age of 65 or 70, it does look frightening. However, as long as you make sure you keep up with your retirement planning, there should be no need for stressing. There are hundreds of alternatives to make money, including life insurance settlements and just simply evenly distributing your salary. It is crucial to set goals and be sure to stay organized. The last thing you want to do is not keep track of your money. If you don’t, in 20 years from now, you sure will be kicking yourself.

Natalie Aranda writes on family and financial planning. Through life settlements, one can actually sell their insurance plan to a third party. By doing this, the person acquires a large amount of money, and they are no longer connected to their life insurance. If you are in need of extra money, many people feel that life insurance settlements are beneficial.

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IRA Retirement Plan Investing & Stretch IRAs
By Rocco Beatrice

How would you like to discover little known IRA retirement plan investing tools that practically pay for themselves and yet do not need to worry about Roth IRA contribution limits? You don't have to go off shore to get tax free retirement income. You don't have to worry about tax free distributions and you don't have to hide your money. It's all perfectly legal right here in the United States, and your assets never leave the United States. The principle is guaranteed, you will never lose your money in the stock market, real estate market, commodity market, or any other market. There is a minimum return on your contribution, and if you die, your family will get a death benefit.

Solutions for your Jumbo IRA and Estate Tax Problems

I want to talk to you about another matter - that is, traditional IRAs. How do you get a million dollar IRA? Well, let's assume for a minute if you were an executive of a major company, and you were just laid off, and you have a million dollars or more in your qualified pension plan, like a 401k, a retirement plan, etc. If you have a million dollars or more, it is what we refer to as a Jumbo IRA. If you also have an estate tax problem, there is a double tax. I'll talk about that in a minute.

If you ask your accountant, your lawyer, your financial planner and ask, "Hey Joe, what's the best way that I can minimize my taxes on my traditional IRA? It's gotten up there and I don't need the money yet. I don't need to go out there and start taking the money out. I'm over the age of 59 ½, I don't need the money, I have other sources of income, so I'm going to let it grow and leave it there." He's going to come back to you and say, "Stretch IRA, stretch IRA!" What does that mean? In simple terms, it means instead of making distributions to you, the owner of the IRA, the beneficiary of the IRA is your children and your grandchildren; you're going to name a beneficiary who is younger than you.

It can be your children, your grandchildren so the required distribution is going to be over their lives. Obviously, they are going to be able to have a greater life than you because the assumption is that you have so many years left on your life, your children have more years on their life (after you), and your grand children have an additional amount of time left on their life (after your children).

So you'll stretch the payments and the assumption is that stretching the distributions from the IRA, the individual is going to be in a lower tax bracket. And that's going to work out fine; but if you are having an estate tax problem when you die, we look at what assets you own. The fair market value is what is included in your estate, not what you paid for it. On the date of death, what do you own at its fair market value?

401K Rollover to Traditional or Roth IRA with Estate Tax Problem: Internal Revenue Code Section 691c (Income Respect of a Decedent)

If you have an estate tax problem, and you have a traditional $1- $3 million dollar IRA, it's going to be double taxed, I can guarantee you that. It's a guarantee from me to you that you're going to be double taxed. On the date of death, the trigger that is going to guarantee your double taxation is, number one, Internal Revenue section 691c. Look it up, that is called income in respect of a decedent, IRD. It is a very important code; this is what triggers the income tax. Essentially, here's what it says: When you took your 401k rollover to IRA, you rolled your 401k, pension or other pension money into a traditional IRA.

You rolled into it because you wanted to avoid the immediate taxation. But the bottom line is this: you have a million dollar IRA, and you have an estate tax problem which triggers the event of section 691c, income in respect to a decedent or IRD. What this section states is you saved money, we didn't tax you and we now want to tax you; hence, there is a forced distribution at 70 ½ years old.

Best IRA Rescue provides services on your Roth IRA, IRA investments & traditional IRA and will help you reduce your inherited and beneficiary independent retirement account taxes in your estate assets. Roth on ROID™ is your advanced Roth IRA retirement planning strategy. It is Cash Value Life Insurance and one of the best IRA tax-savings strategies with benefits of a guaranteed death benefit, guaranteed principal, tax-free growth, and tax-free distributions from policy loans. Traditional IRAs and ROTH IRAs cannot invest in life insurance. Please contact us if you have any questions. Rocco Beatrice, CPA, MST, MBA
Best IRA-Roth IRA Read the second part of this article: IRA Retirement Planning
Boston, MA: 71 Commercial Street #150 Boston, MA 02109
Costa Mesa, CA: 543 Victoria Ste. J, Costa Mesa, CA 92627
toll-free: 888-93ULTRA (888-938-5872) tel: +1.508.429.0011 fax: +1.508.429.3034

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Life Insurance - Why it is a Must Have in Your Financial Planning
By Thomas Hermschulte

There are at least four very good reasons to include life insurance to your financial strategy:

Reason 1: Take today a group of 100 people at the age of 25. According to the Social Security Administration (SSA Publication No. 13-11871, April 2000) 16 of them already died when the group reaches the age of 65. The number of people who needs to be supported by family and charities at that age is 66. The remaining 18 are financial independent. Just 18% are independent! This is way too few, none of us wants that our kids have to take the burden of supporting us after we have retired.

Reason 2: The study shows that 18% are financial independent, but how does the Social Security Administration define financial independence? The definition is: The annual income of a household or person greater than $30,000. That is not much! To get a feeling how low that amount really is, lets take look at the annual median income of all 58 Californian Counties. Only four of them have currently a lower median annual income than $30,000. This means, if you retire in California at 65 and you are financial independent (according to the SSA standard) you will probably have less income in more than 93% of the Californian counties than the median household there. So there is a good chance that you will not be able to spend your retirement in the "Golden State", together with so many other people who lived and worked hard here their entire life, even if you "are" financial independent.

Reason 3: We have all heard and read the stories of 80 year old retirees who have to start working again because their 401(k) or 403(b) or any other IRA plan has gone down significantly in value. This did not just happen to retirees. No, unfortunately everybody experienced a loss in their retirement plans. Why? Because the Stock market, in which most of the retirement plans are invested in, is unpredictable. More than just one study has proved this fact. Even experts, like Jim Cramer from "Mad Money" on CNBC didn't see the recent collapse of the Stock market coming, and he makes his living from watching the stock market and referring stocks to his viewers. The question that rises is: if he can't see a crash of that magnitude coming, how can your stock broker or financial adviser? The answer is simply, they can't.

Reason 4: We all know that life insurance never performs as well as a fund, a CD, a single stock or any other stock traded paper can. But this is and can be a very good thing that works in your favor. Because it means that life insurance is a safe and steady financial investment. You can rely on your life insurance, it will hold its value and therefore protect your investment. It builds an immediate estate. Even if you just paid one premium! Can you say that from any other financial product?

In order to be financially wise, you should always build your financial independence on a solid life insurance basis.

Click here for a complete list of the annual median income of all 58 Californian counties.

Thomas R. Hermschulte is an Financial Advisor and Representative of Mutual of Omaha http://www.MutualofOmaha.com

We currently offer our clients a free consultation to overlook their financial situation and offer free advice in these economical stormy days.

If you want to learn more what we can offer for you, contact me:

thomas.hermschulte@yahoo.com
2601 Main Street, Suite 960
Irvine, CA 92614

Cell: 714.330.1899

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All About Life Insurance and Retirement Planning By Insurance Experts

2009-08-04T09:53:00.000-07:00

Planning For Retirement - 7-Minute Guide
By Rocco Beatrice

It's never too late to begin saving for retirement. Many people think that if they are close to retiring, then it is too late to save. This is not true. It doesn't matter how old you are, you can always begin to save money for your retirement. The following tips will help you organize your finances before you leave the work force.

It is typically better to begin saving for retirement in your younger years. This will allow your contributions to grow and will provide you with more money when your reach the age of retirement. There is no way to know what you will need when you retire. Even if you feel confident about your retirement, chances are you will not have saved enough money to support your lifestyle. That is why it is so important to begin contributing to a retirement plan as early as possible. A recent study revealed that 60% of people in their 50s and 60s have experienced a job loss or an illness. This prevents them from earning money, thus preventing them from saving for retirement.

While you may think you have saved enough, here are some statistics that may make you think otherwise. More than 50% of workers in their 30s have retirement plans that have a value of $17,000. When they reach their 40s, 60% or workers have accounts with a $40,000 value. After the age of 55, most people have less than $100,000 in a retirement account. These savings are far from adequate, especially when you consider that you will be withdrawing 4 to 5% of the amount each year when you retire. To make matters worse, most retired individuals receive most of their income from Social Security, which averages at $1,150 per month. That is barely enough to live on.

It may seem like those retirement years are far in the distance, but it is so important to begin saving as soon as you can. It is recommended that the average worker should save at least 10% of their annual income for retirement. Most retirees will require 75% of what they were making in the workforce in order to continue living in the same manner. Young workers cannot rely on Social Security, so saving now is imperative!

There are many ways to save for retirement. Most employers will offer some type of retirement plan. Typically, it is a 401(k) plan. These will allow you to save around $16,500 per year. The amount increases annually and is based on your pre-tax income. If you are over the age of 55, you can save up to $22,000 a year with a 401(k). The advantage is that you will not have to pay taxes on the money until you begin to withdraw from the account.

IRA's are another way to save for retirement. The contribution limits are much lower with these. You can only contribute $5,000 per year. If you are over 55, the amount is raised to $6,000 yearly. Roth IRAs and Roth 401(k) plans are also available. These plans offer you the ability to save income that has already been taxed. This is a huge benefit later because you will be able to withdraw from the accounts without having to pay any taxes.

Even though you make contributions to a retirement plan that does not mean that is all you need to do. It is important to review your accounts each year. You can reallocate your investments to earn more money. Another thing to keep in mind when planning for retirement is to plan for the inevitable. Make sure to have a current list of all your assets. This will be a huge help if you should die. Always keep your list of beneficiaries current and have a living and traditional will.

Many of us have trouble looking ahead and planning for retirement. If you are in your sixties, it is time to focus on reality. You will be retiring soon and you want to make that transition as smooth as possible. It is advised to pick a date for retirement. This will help you determine if you will have the finances you will need. Make sure you know where you will be living and prepare a possible budget and make sure to put extra aside for health care.

If you have not yet begun to save and plan for retirement, don't panic. It's never too late. Situations can change daily and you never know what could happen. If possible, continue to work past the retirement age. This will allow you to continue to save for the day you do retire.

Best IRA Rescue provides services on your Roth IRA, IRA investments & traditional IRA and will help you reduce your inherited and beneficiary independent retirement account taxes in your estate assets. Roth on ROID™ is your advanced Roth IRA retirement planning strategy. It is Cash Value Life Insurance and one of the best IRA tax-savings strategies with benefits of a guaranteed death benefit, guaranteed principal, tax-free growth, and tax-free distributions from policy loans. Traditional IRAs and ROTH IRAs cannot invest in life insurance. Please contact us if you have any questions. Rocco Beatrice, CPA, MST, MBA
Best IRA
Roth IRA Contribution Limits
Boston, MA: 71 Commercial Street #150 Boston, MA 02109
Costa Mesa, CA: 543 Victoria Ste. J, Costa Mesa, CA 92627
toll-free: 888-93ULTRA (888-938-5872) tel: +1.508.429.0011 fax: +1.508.429.

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What is a Retirement Annuity?
By Pepita Mendieta

Anyone who is looking into retirement planning has probably come across the words retirement annuity. When mixed in with words like term life, variable, investment and insurance it can seem to be a confusing and intimidating word. Many of the terms used in retirement planning are intimidating, unless you are an accountant most of these words are not part of your everyday vocabulary. However, truthfully, a retirement annuity is nothing to be afraid of; in fact, it could be a retiree's best friend.

A retirement annuity is an agreement between you and an insurance company. This agreement involves you making payments into an investment account that the insurance company controls. The insurance company will manage your investments and when you retire will pay out to you all the earnings of the investments in a periodic payment of a set amount. You have the choice to may your payments in a periodic manner over many years (such as through a paycheck deduction) or in a lump sum.

What this really boils down to is that you will have a guaranteed regular income after you retire and you will not have to worry about supplemental income. After all, we all have heard the warnings about counting on social security for our retirement, and we know that we need to have a back up plan in place.

The sooner you set up an annuity, the longer it will have time to earn money for you before you reach retirement age, which means either larger payouts for you, or more income for your family for a period of time after your death.

Retirement annuities offer many different structures, levels, and types, to match whatever retirement plan you have, whether you are going to rely on your annuity as your main retirement income or of you have many other investments, residual incomes, and supplemental incomes. This is one of the reasons so many people include annuities in their retirement plans. Between the flexibility and the reliability, there is not a lot in the cons list for a retirement annuity.

If you are planning for your retirement and are not sure if an annuity is the right choice for you, contact your insurance provider and have them prepare a prospectus for you. A prospectus details all the options of the annuity and will show you the benefits and drawbacks that you will need to know about before purchasing an annuity. If you have any questions about the prospectus, discuss it with your insurer or financial planner before making a final decision.

When planning for your future it is important to take into account the fact that you will need a regular income, no matter what the source of that income is, it is imperative that you plan ahead or you can face the perils of not having money for groceries, medicine, or even house payments. Take the time to find out about all of your options and choose what works for you as you plan your retirement.

For more information and resources retirement annuity, supplemental income, annuities insurance, insurance annuity, immediate annuity quote, immediate fixed annuity, annuity quote, guaranteed annuity, annuity purchase visit http://www.buyapension.com

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Finding the Best Retirement Annuities
By Steven Hart

As an investor moves into retirement, their financial priorities will change. Their attention will turn to generating income from investments. The attitude towards risk for the investor should also change, and in general they will begin to move towards lower risk investment. Preservation of their principal is also important to retirees so that they have enough savings to last throughout their lifetime and perhaps their spouse's lifetime.

Retirement annuities are exactly the investment vehicle that is required to help retirees make this transition in financial priorities. Retirement annuities offer them an income stream for life. If a retiree is new to annuities, they will probably be interested in immediate annuities at first. Immediate annuities have no accumulation period and generally begin to payout within one year of the premium payment.

One reason why an investor would be looking at an immediate annuity is if they participated in a company contribution plan throughout their working life. They can withdrawal their accumulated proceeds from this plan and purchase an immediate annuity to secure their future income.

Although immediate annuities are usually the prescribed payout model for retires, a deferred annuity can also be the recommended retirement annuity in certain circumstances.

The trend is that life expectancy is increasing due to advances in healthcare. Another trend is that more and more workers are taking early retirement. In the past, retirees were on average not expected to live a decade past their retirement. Therefore, a deferred annuity was not the ideal product choice since an investor was not likely to live long enough for the annuity to mature.

However, although good trends, the early retirement and increased life expectancy demographics make retirement planning more difficult for someone that has recently retired. The likelihood of the average American outliving their retirement savings is become more and more of a possibility.

With this in mind, deferred annuities should also be considered as a retirement option by retirees. If for example, someone lives into their 80s, but retires in their late 50s, a deferred annuity may be the correct choice depending on their other financial circumstances. They will live long enough to see their investment mature.

When selecting the best retirement annuity, retirees need to consider if they want their spouse to be able to continue receiving a steady income if they die first. It is important for an investor to understand their own needs so that they can select the appropriate retirement annuity contract. Retirees should also consider what the likelihood is that they may need to withdraw funds from the annuity. Some annuity contracts have very high withdrawal fees even if the funds are used for emergency circumstances.

In conclusion, as an investor moves into retirement, their financial priorities will change. As their preferences turn to lower risk and income generation, a retirement annuity is the best investment vehicle for them. In the past, immediate annuities were always the recommend product for retires. However, as life expectancy increases and retirement age decreases, deferred annuities can also be the preferred investment product for certain individuals.

For more information from Steven on how to invest in annuities and common investment mistakes, visit his Immediate Annuity Guide. To learn more about securing your retirement with life annuities, visit the Life Annuity Guide.

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