Talking Retirement

Financial Lessons from Current Retirees

The Shreveport Times has an article, Finance lessons should accompany retirement, that has good information from people who have some experience on retiring, current retirees. It begins with an interview with Walter Laney, a recently retired GM employee. “The best advice he can give to upcoming retirees: Pay down debt and learn to budget.” The article goes on to point to several sites that have some helpful tools on them. (Here is the correct link to the T. Rowe Price calculator’s they mention in the article.)

It also points out inflation is something to keep in mind when you’re doing your financial planning for retirement. “For example, if you own your home or plan to downsize, rising home prices may not affect you much, Ferrara says. But increases in health care costs, which typically grow faster than the overall inflation rate, could have a big impact on your savings.” Read the full article for more advice.

Planning for Retirement by Age

I found a quick overview of what you may want your asset allocation to look like by decade (how you should be allocated in your 20s, 30s, 40s, etc.). It’s from USA Today writer John Waggoner, and it also discusses—in broad terms—financial steps you should be taking in those years to prepare for retirement. Read the article.

Turning Your Investments Into an Income Stream

Annuities are products you can purchase from insurance companies that will start paying you a fixed amount of money every month. There are a lot of things to learn about them before you take the plunge and buy one. Luckily WalterUpdegrave outlines some of the basics in another of his great columns. Click here to read it.

How Is a 401(k) Plan Paid Out?

The law allows for five different alternatives for a 401k account at retirement. The options are: lump-sum distribution, continue the plan, roll the money into an IRA, take periodic distributions, or use the money to purchase an annuity.

Click here for the article.

Max. Social Security Check in 2006 is $2053

I found an interesting Q&A on Social Security in the LA Daily News this morning. It answers a few basic questions about Social Security benefits (the maximum check in 2006 will be $2053, for instance). If you want to know more about your Social Security benefits, a great place to start is Social Security Online—the official website of the Social Security Administration. Among other things, it offers a number of calculators that can help you determine what your Social Security check may be, regardless of when you retire. You paid for it, check it out. 

Women and Saving Money

• Not only do most (71%) women worry about their finances
• And nearly half (49%) say they lose sleep over it
• But, unexpected expenses were the biggest cause of financial angst.

The article starts with that depressing news, but it gets brighter from that point. The author analyzes three women’s financial situations and offers advice.
Whether you’re a woman or man, if you’re trying to save more, you might find these profiles helpful. Read the article.

A Brief Look at Asset Allocation

To build a portfolio of investments that will sustain you throughout your life, you need to know a little something about asset allocation. I found a good article on MSN this morning that gives a basic overview of how your age and risk tolerance can help determine how much money you allocate to stocks, bonds and cash. It also explains how increasing life expectancies are affecting asset allocation formulas. Read the article.

Valuable Retirement Planning Information for Women

I was reading an article about lifetime annuities on the Kansas City Star’s site this morning. The gist of the piece was that this type of investment product might be a good choice for women, because women face special challenges in retirement (longer lifespan, lower income, etc.), and lifetime annuities provide a steady stream of income for the remainder of one’s life.

In the body of the article was a link to the site of an organization called WISER, which is an acronym for Women’s Institute for a Secure Retirement. The organization itself is dedicated to improving the long-term financial security of women through education and advocacy. The site is a tremendous resource, and offers a wealth of information on topics including:

-Retirement Plans
-Social Security
-Saving and Investing
-Divorce and Widowhood
-Healthcare

Whether you are a woman, or simply have women in your life that you care about, the WISER site is worth checking out.

The Basics on a 401(k) Plan

Today we’ve added a new category called Basics. You can see that this article is categorized under Basics just above the next headline. Look for the words “Filed under” below. You can also see articles in any category using the Category column at the right.

Our first “basics” article is about 401(k) plans. You may already know all about them, but I know many people still find them a little mysterious. This story from Denver’s ABC station gives a quick overview of 401(k) plans that might clear up some questions. It starts with an easy explanation of what a 401(k) plan actually is and why it has that awkward name. 

The name 401K comes from a provision of the federal income tax code. Every paycheck, you put some money away in a retirement account. The money is invested and your current tax bill is lowered. And many employers kick in some money as well.

Good basic advice. Read the whole article for more information.

Life Expectancy Calculator

After reading Bruce’s post from earlier today, I clicked on a link in the MSN story to their Life Expectancy Calculator. Curious? Check it out.