Yikes! 30% of Workers Can’t Answer This…Can You?
One third of workers don’t know the answer to this simple question about their retirement savings: Now that you’ve saved for retirement, what are you going to do with the money? Click here for more details, and tips on what you should be thinking about for your retirement savings.
We’re Going to Tell You the Top 6 Things No One Tells You About Retirement
According to The Motley Fool‘s Chuck Saletta, “To make your retirement years truly golden, understand what may be coming your way. Many of us look forward to retirement as the reward for a lifetime of hard work. While the post-work years can truly be golden for those who plan for them, many retirees are caught off guard by the facts of their new life.”
Click here to read about six important issues you should know about before you leave the working world for good.
You Can’t Afford to “Wing It” When It Comes to Retirement!
Having a written plan makes it more likely you will stick to your plan.
You’ve heard this before: Failing to plan is planning to fail. This couldn’t be more true than when it comes to retirement. According to a recent survey conducted by the Transamerica Center for Retirement Studies (TCRS), more than one-third (37 percent) of workers don’t have any strategy for their retirement. These people are truly winging it…leaving their futures to chance.
The study also found that almost half (47 percent) of all workers have a strategy, but it’s not written down. Such a plan is better than nothing, but most likely it’ll be incomplete.
Fewer than one in five workers (16 percent) have a written plan, which is ideal. Research in behavioral economics shows that having a written strategy increases a person’s commitment to carrying out the plan.
So what should go into a successful retirement strategy? Read more, and check out additional links, from MoneyWatch’s Steve Vernon.
How people get as much as 88% more from Social Security!
Many people may be unaware of the impact various decisions can have on their ultimate social security benefit amount. Timing of election, work income, taxes, spousal benefits, etc., must all be considered in effective social security benefit planning.
Regarding the timing of elections, for example, according to a recent study covered by CNBC, someone who retires and begins claiming Social Security at age 70 would receive a benefit that’s 76 percent higher than the one he or she would receive at age 62. The CNBC piece points out that if you factor in late-career earnings replacing a zero-income year, the increase can become as much as 88 percent for women and 82 percent for men.
At Frye Retirement we are familiar with the complicated algorithms, and can crunch the numbers and guide you with any of your social security planning questions. For the full CNBC piece click here: how to get 88% more from social security.
There’s still time for 2016 tax savings…but it is running out!!
With proper 401(k) retirement plan design techniques, clients can reduce taxes, improve owner benefits, and lower employee costs:
$53,000 individual deduction limits for 401(k)/profit sharing plans. If 50 or older, up to $59,000 can be funded into 401(k).
Contributions of up to $300,000 for small business owners in Defined Benefit plans (depends on age and service).
IRS tax credit of $500 per year for the first 3 years of the plan for installation and administrative costs if your client has employees.
Uni-K plan to maximize deductions for self-employed, owner-only or owner-spouse business owners with low W-2 wages (i.e. deduct $28,000 with only $40,000 in wages; if 50 or older, deduction increases to $34,000.
DON’T DELAY: Plans must be adopted by December 31, 2016 (but plans don’t have to be funded until 2017).
Good News on Tax Saver’s Credits
Laws that were enacted as part of the Bipartisan Budget Act of 2015 include new rules that could mean larger tax credits for some workers.
Bigger Retirement Savings Contributions Credit
The Saver’s Credit is an important tax credit that many American workers who save for retirement may be missing out on. Low and moderate-income savers who meet IRS requirements may be able to take a bigger tax credit (“Saver’s Credit”) of up to $2,000/$4,000 (singles/couples) for making eligible contributions to an employer sponsored retirement plan or IRA. To see if you qualify, visit www.irs.gov and enter “Do I qualify for the Retirement Savings Contributions Credit?” in the search box.
