The National Economic Planning Board has dedicated February as Retirement Savings Month, so we encourage readers to reflect upon a few key points about planning for one's future.
The last two years during this pandemic, have provided us with a means to reflect and to bring into focus the importance of a balanced life. As we move through the current challenges, let us focus on how to improve our quality of life not only today but during our later years in retirement. The first step is to open a retirement account and take the necessary steps of funding it on a regular basis. This commitment is crucial in building your nest egg for the future and ensuring your quality of life is maintained.
Despite our specific circumstances, each of us hopes that there will be a time in our life when we can retire and enjoy our senior years with comfort and dignity. In order to ensure a comfortable life during our golden years, it is important for everyone to plan and save enough money to cover our living expenses and support our desired lifestyle.
The National Economic Planning Board has dedicated February as Retirement Savings Month, so we encourage readers to reflect upon a few key points about planning for one's future. This month we will focus on some key areas:
Savings for Retirement
Do you have retirement savings account for yourself? It is important to maximize your contribution allowed under federal rules and make a monthly contribution as part of your monthly budget. Do you know the retirement savings contribution limits for 2023? Is pre-tax (Traditional IRA) OR after-tax (Roth IRA) better? Does your spouse have a retirement account? Consulting with your CPA and financial advisor can help answer many of these questions.
Health Savings Account
As we age, the medical costs also increase, and we must be prepared to cover these. How can we save for them so that they may be used later in our retirement? Health Savings Account (HSA) is one such vehicle and is only available with high deductible health plans. However, if you have pre-existing conditions this type of plan may NOT be the best option for you.
Long Term Care
Long Term Care is insurance coverage that provides funds for care later in our retirement. Generally, our families help take care of us, but what if they are unable to do so? The cost of individual care at a facility or even with a private caregiver at home is increasing every year and generally must be paid for by ourselves. Let us start by understanding how it works and what options are best suited for you so that you can start making informed decisions.
Social Security
Social Security plays an important role in this country. An annual checkup of one's account is important. Also, is the earnings information in the account, correct? What is your full retirement age and what monthly benefits are you eligible for? The age at which one should apply for benefits depends on one's health and other factors, in order to maximize the amount received. All this information will help you plan for your retirement.
Tax Savers Credit
If you meet certain income limits, the IRS provides you with tax credits. Do you qualify for this free money? If so, are you taking advantage of it? Consulting with your CPA!
Power of Compounding
The most powerful way to have your money grow? A little growth every year that is reinvested will continue to grow your money. If the roots are strong the tree will be bountiful and multiply. Do you know how your investments are growing?
Emergency Fund
Since March of 2020, we have been faced with a pandemic which has meant financial challenges. It is so important to have an emergency fund to help navigate through such times. Do you have an emergency fund? Is it enough to cover your expenses in case you lose your job or business? How long will it last?
Our goal is to ensure Jamat is aware of the importance of saving and taking necessary steps to not only open a retirement account but also to regularly fund their retirement savings account.
You can learn about more ways to secure your future by registering for the following webinars: Session 1 can click here to register for the retirement savings webinar on February 5, 2023, at 12:00 pm. CT.
Session 2 can click here to register for the retirement savings webinar on February 19, 2023, at 12:00 pm. CT.
