45 percent of people who switch jobs before age 59½ cash out on their retirement plans. Perhaps sometimes this is necessary, especially if the reason why you cashed out was due to an unexpected job loss where no other sources of income were immediately available to you. Still many others do it without fully understanding the potential harm they are doing to their long-term retirement prospects. Right off the top, you’re giving up 20-40 percent of your money if you cash out on your plan to taxes and penalties. Moreover, you’re missing out on future compounding of that wealth....
Preparing for Retirement in America
The Employee Benefits Research Institute and Greenwald & Associates recently released the results of their 2016 Retirement Confidence Survey. Two statistics I found particularly interesting are highlighted from the report below. Both questions dealt with the action of saving: who has saved money and who is currently saving....
Beneficiary Planning for Retirement Accounts, Part II – Non-Spouse Beneficiaries
As I mentioned in my last blog, designating a beneficiary that is not your spouse for your retirement plan accounts introduces a more complex set of rules. Non-spouse beneficiaries are subject to different distribution schedules and must follow strict guidelines if they want to “stretch” an IRA’s life (discussed below)....
Beneficiary Planning for Retirement Accounts, Part I – Leaving it to your Spouse
Completing and periodically reviewing beneficiary paperwork is the one of the most important administrative tasks a retirement plan participant can take. Overlooking this seemingly easy step can lead to the wrong individual(s) inheriting your retirement nest egg; there have been too many unfortunate stories regarding non-updated beneficiary designations to leave this unattended. Hence why, like all estate planning documents, periodic check-ups should be implemented so that any necessary changes are made in a timely manner....