What’s your retirement ‘contingency plan?’ - Ahwatukee Foothills News: Money

default avatar
Welcome to the site! Login or Signup below.
|
||
Logout|My Dashboard

What’s your retirement ‘contingency plan?’

Print
Font Size:
Default font size
Larger font size

Related Stories

Posted: Thursday, September 12, 2013 7:45 am

You probably have thought about what you’d like to do during your retirement years. But all your plans probably depend, to at least some extent, on your financial situation. What happens if you reach the age at which you wish to retire and you just don’t have the money you thought you’d have?

If this occurs, it’s time for “Plan B.” What does that look like? Here are a couple of possibilities:

• Continue working. If you like your job, you may not mind working an extra year or so. You’ll be bringing in more income and contributing more to your 401(k) or other retirement account — and, perhaps almost as importantly, you may be able to avoid tapping into these retirement accounts, thus giving them more time to potentially grow. (However, once you turn 70 1/2, you’ll need to begin taking withdrawals from your 401(k) and a traditional IRA). But if you are really not enamored with the idea of working any longer, you might find that even the ability to “beef up” your retirement plans for another couple of years isn’t much consolation.

• Adjust your retirement lifestyle. It’s pretty simple: If you don’t save as much as you had planned for retirement, you probably can’t do all the things you wanted to do as a retiree. For example, you may not be able to travel as much, or pursue your hobbies to the extent you’d like.

Clearly, you’d like to avoid these “retirement contingency plans.” To do so, though, you’ll need to take steps well before you retire. And the most important move you can make may be to contribute as much as you can possibly afford to your IRA and your 401(k) or other employer-sponsored retirement plan.

During the last several years before you wish to retire, you may be in a strong position to “max out” on these plans because, at this stage of your life, your income may be at its highest point, your children may be grown and you may even have “retired” your mortgage. If you still have money left with which to invest, you may want to look at other tax-advantaged vehicles that can be used for retirement.

But while it’s important to put in as much as possible to your retirement accounts, you need to do more than that — you also must put the money in the right investments within these accounts. Your exact investment mix should be based on your individual risk tolerance and time horizon, but, as a general rule, these investments must provide you with the growth potential you’ll need to accumulate sufficient resources for retirement.

Of course, as you know, investments move up and down. You can’t prevent this, but you’ll certainly want to reduce the effects of volatility as much as possible when you enter retirement. Consequently, during your final working years, you may need to adjust your retirement accounts by shifting some of your assets (though certainly not all) from growth-oriented vehicles to income-producing ones.

It’s a good idea to have contingency plans in place for virtually every endeavor in life — and paying for your retirement years is no different. But if you can make the right moves to avoid the contingency plans in the first place, then so much the better.

• This article was written by Edward Jones for use by Ahwatukee Foothills Edward Jones Financial Advisor Joseph B. Ortiz, AAMS, CRPS. Reach him at (480) 753-7664 or joseph.ortiz@edwardjones.com. Accredited Asset Management Specialist and AAMS, Chartered Retirement Plans Specialist and CRPS are registered service marks of the College for Financial Planning.

More about

More about

More about

  • Discuss

Kerry’s Blunt Words for Israel Denounced by Lawmakers in Both Parties

A bipartisan chorus of lawmakers, upset with President Obama’s decision last week to allow the passage of a United Nations resolution condemni…

Published: December 31, 2016 - 10:14 am @ http://www.nytimes.com/2016/12/28/us/politics/john…

Gov. Brown Appoints New Public Utility Commissioners to Replace Florio and Sandoval

Martha Guzman Aceves and Clifford Rechtschaffen both come from the governor’s office with strong environmental protection backgrounds. Martha …

Published: December 31, 2016 - 10:14 am @ https://www.greentechmedia.com/articles/read/gov.-…

Presidential vote in congressional districts points to Democratic risks in 2018

Democrats started the 2016 election cycle with pessimism about their chances of taking back the House of Representatives. For a few moments th…

Published: December 31, 2016 - 10:13 am @ https://www.washingtonpost.com/news/post-politics/…

Obama preparing to penalize Russia for hacking

WASHINGTON — The Obama administration is preparing to penalize Russia over the hacking of Democratic officials during this year's presidential…

Published: December 31, 2016 - 10:16 am @ http://www.usatoday.com/story/news/politics/2016/1…

Mail truck tips on Mesa street

MESA, Ariz. - A mail truck ended up on its side in a crash Wednesday. Mesa police say a single-vehicle collision left the United States Postal…

Published: December 31, 2016 - 10:12 am @ http://www.12news.com/news/local/valley/mail-truck…

Reports of mall disturbances light up social media

A flurry of reports of mall melees and disturbances rippled across social media Monday on a day Americans swarmed shopping hubs for post-holid…

Published: December 31, 2016 - 9:51 am @ http://www.usatoday.com/story/news/nation/2016/12/…

Graham, McCain want Russia sanctions after election hacking

Top Republican senators said Wednesday that the incoming Congress and President-elect Donald Trump should impose new and tougher sanctions on …

Published: December 31, 2016 - 9:13 am @ http://www.foxnews.com/politics/2016/12/28/graham-…

Immigration Is the Only Hope for States That Helped Trump

The decline of manufacturing does not explain the decline of Wisconsin. Photographer: Daniel Acker/BloombergFacebook Twitter Email Print Share…

Published: December 31, 2016 - 7:17 am @ https://www.bloomberg.com/view/articles/2016-12-28…

Creator of the Red Solo Cup dies at 84

FOX 32 NEWS - The creator of the Red Solo Cup died on Wednesday, December 21, 2016 at the age of 84. Robert Leo Hulseman lived in Northfield, …

Published: December 31, 2016 - 7:07 am @ http://www.fox4news.com/trending/225996868-story

12 Cars You Can Legally Import to the US in 2017

slide-4320347 There were plenty of great vehicles produced abroad that Americans (outside of Canada) haven't been able to import until they hi…

Published: December 31, 2016 - 7:06 am @ http://www.autoblog.com/photos/cars-you-can-legall…

Facebook

ahwatukee.com on Facebook

Twitter

ahwatukee.com on Twitter

RSS

Subscribe to ahwatukee.com via RSS

RSS Feeds

Spacer4px

Most Popular

Online poll

Loading…