Advertisement
retirement

Make a Plan for Your Retirement Savings

The first step to effectively using your 401(k) is to assess your retirement needs.

How do you come up with the right amount to divert to your 401(k) plan?

Financial planners have traditionally estimated that retirees need 80% or more of preretirement income to maintain their standard of living, but individual situations vary greatly. Paying off a mortgage before retirement can substantially reduce need for income, while paying for health insurance can radically inflate it.

Advertisement - Article continues below

Of course, you have to work within the investment options available to you. Typical plans offer about 18 investments, including stock and bond mutual funds; balanced funds, which invest in both; "target date" or asset-allocation funds, which include a mix of investments based on your age and how much risk you are willing to take; and fixed-interest investments, such as money-market accounts. About 15% of plans now allow participants to "self-direct" their account by buying individual stocks and bonds.

Advertisement
Advertisement

Most Popular

18 Things You Can't Return to Amazon
Smart Buying

18 Things You Can't Return to Amazon

Before tossing these items into your virtual shopping cart, be sure to read Amazon's return policy first.
September 17, 2020
Election 2020: Joe Biden's Tax Plans
taxes

Election 2020: Joe Biden's Tax Plans

With the economy in trouble, tax policy takes on added importance in the 2020 presidential election. So, let's take a look at what Joe Biden has said …
September 18, 2020
7 Foreign Countries Luring Americans to Work Abroad During the Pandemic
careers

7 Foreign Countries Luring Americans to Work Abroad During the Pandemic

Work remotely – really remotely – in these appealing destinations offering special visas for American workers.
September 18, 2020

Recommended

HSA Limits and Minimums
health savings accounts

HSA Limits and Minimums

Annually adjusted contribution limits and other requirements must be met if you're covering health care costs with a Health Savings Account.
September 21, 2020
Don’t Be Paralyzed by Uncertainty
retirement planning

Don’t Be Paralyzed by Uncertainty

You definitely need a plan, because what’s ahead could be scarier than what’s behind us.
September 21, 2020
Insurance for Long-Term Care at Home
retirement

Insurance for Long-Term Care at Home

In the wake of COVID-wracked nursing homes, increasingly more people are looking at options to age in place with long-term care insurance.
September 17, 2020
Medicare Basics: 11 Things You Need to Know
Medicare

Medicare Basics: 11 Things You Need to Know

There's Medicare Part A, Part B, Part D, medigap plans, Medicare Advantage plans and so on. We sort out the confusion about signing up for Medicare --…
September 16, 2020