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Saving for Retirement

Best Retirement Tools

Six consumer-friendly retirement products and why we like them.

SEE THIS SLIDE SHOW: The Best Tools to Help You Retire

ALL-AROUND RETIREMENT ACCOUNT
Roth IRA

If you see higher taxes in your future, the Roth IRA looks better than ever. There is no upfront tax break, but you benefit from tax-free growth and tax-free income in retirement. Plus, you get the flexibility to withdraw contributions (but not earnings) anytime, tax- and penalty-free. And you can tap earnings early to pay for college or buy a first home.

TARGET-DATE RETIREMENT FUNDS
T. Rowe Price

T. Rowe Price target-date funds have a high exposure to stocks, so their recent performance has been slightly worse than that of their peers. Year-to-date to October 13, the Price 2020 fund, designed for people planning to retire in about 12 years, was down nearly 33% from a year earlier, compared with a 32% drop for Fidelity's 2020 Freedom fund and a decline of about 29% in Vanguard's 2020 fund. But the higher stock allocation will increase chances for growth over the long run.

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IRA FOR KIDS
Schwab

One of the few financial institutions that lets you establish a custodial IRA for a minor child, Schwab offers a no-fee IRA with the lowest minimum-investment requirement in the industry -- $100. As long as your child has earned income, he or she can contribute up to $5,000 this year to an IRA -- or up to the total amount of earnings if he or she earned less than that.

NEW ONLINE RETIREMENT TOOL
TD Ameritrade's WealthRuler

This free, comprehensive tool helps you determine whether your current savings are on track and suggests ways to catch up if you're behind. For those close to retirement, T. Rowe Price's new retirement-income calculator projects whether your savings will generate adequate income.

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ANNUITY INCOME TOOL
Metlife

This new guide from Metlife shows how including an income annuity as part of your retirement investment portfolio can boost your spending power and provide guaranteed income that you can't outlive.

ONLINE TOOL FOR 401(K) PARTICIPANTS
Fidelity

The largest provider of 401(k) plans "makes it easy for participants to get in, get the information they need and get out," says Lee Kowarski, principal of Kasina, a consulting firm for the asset-management industry. Kasina selected Fidelity as the top-rated site out of more than 80 record keepers for defined-contribution plans, followed by T. Rowe Price and Vanguard.


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