Traditional Pensions
No More
Most industries have done away with traditional pensions or defined
benefit plans, a form of payout which is often provided to an employee
based upon their years of service and recent annual earnings. Instead,
companies are switching to defined contribution retirement plans, such
as the 401K or 403B.
Here are some tips to help you leverage an employer sponsored,
defined contribution plan:
| • Invest as much as your personal household budget will
permit on an annual basis, in the form of pre-tax dollars. |
| • If your employer offers a matching program for your contributions,
be sure to invest at least to this level. For example, if they match
3%, dollar for dollar, be sure to contribute at least 3% of your
gross annual earnings into the plan. After all, this is free money. |
| • Allow time to be on your side. Start investing early and
allow compound interest to help build your retirement savings. |
• Do not count on your employer's contributions to be sufficient
for you to achieve your retirement goal. Develop a financial plan
based upon your own personal contributions, allowing any funds that
your employer contributes to be extra.
|
Social Security Questions
Is social security going to be enough to cover your retirement income
requirements?
While this income stream provides much needed funds during retirement,
most individuals and families do not find it to be sufficient to meet
their financial needs. You can review your estimated social security
payment on your annual statement, by calling your local social security
administration office or by requesting information on the agency’s
website. As a baby boomer, you need to be focused on building your own
retirement plan, outside of what Social Security often offers in order
to fully fund your retirement needs.
Health Care
Health care is one of the top concerns for many current and future
retirees. First, be sure to review any retirement health plan options
offered by your current employer. Next, review your Medicare options
and the possibility of obtaining a gap insurance policy, a policy which
has been designed to cover the gap between your health care needs and
what Medicare provides.
Next, review private insurance options designed to cover potential short
term or long term health costs during retirement, such as long term
care. There are a variety of options available which can be used to
plan for long term care, hospital costs and even to help you to cover
the costs of prescription medications should these costs become a factor
for you or your spouse.
Proactive financial planning is the best approach for addressing any
and all baby boomer retirement questions and concerns. With careful
planning today, you can enjoy a comfortable retirement tomorrow.
At Trippon Wealth Management Group, our goal is to be forward thinking
enough to protect our clients now and in the future. Call us at 713-661-1040
and put our experience at work for you, TODAY!
