For most people, life after college marks the beginning of a new era. Their primary goals are often to pursue their careers, get a good job, amass wealth, and to achieve their dreams. Unfortunately, they always fail to consider one thing – Retirement. In fact, some of them assume retirement is for the old, forgetting that they’ll reach that age at some point in their lives.
In truth, retirement is something that touches on every person’s life because it’s inevitable. That’s why it’s always wise to prepare for it financially. Why financially? Well, in most cases, retirement tends to tip the scales of income vs. expenditure. This means that one starts to spend more than what they are earning.
If you are young and at the early stages of your career or if you have never cooked up a sound retirement plan, then making necessary arrangements to secure your future as a retiree is crucial. Below are a few things you need to know about retirement from one of the world’s best progressive financial services industry professionals – Mr. David Giertz.
Early Retirement: A Few Things You Need To Consider!
Most people think of retirement as something that comes during their late 60s (mostly after attaining 65 to 67 years of age). Unfortunately, that’s not always the case. Early retirement is something that can happen to either one of us and at any point in our lives. According to Mr. David Giertz, many factors can lead to this unfavorable twist including layoffs, a health crisis, family issues just to mention a few. But, retiring earlier can also be voluntary.
Regardless of the cause, early retirement can be greatly disadvantageous in the following ways:
* It means that you won’t be able to save as much money as you would have if you worked until your retirement age.
* Your financial reserves may not be enough to cover your expenses throughout your extended retirement period.
This only goes to show how vital it is to start saving for retirement early – you may not have as much time as you think. In fact, David Giertz says it’s utterly impossible to catch up with such a financial deficit especially for people in their 50s who save less than 30% of their net income.
Luckily, according to Mr. Giertz, there may be a few ways to salvage the situation. For example;
* For homeowners, selling your home and moving to a smaller and more affordable one can save you some money.
* You can take advantage of a reverse mortgage for equity.
* You can cut down on your expenses.
* Look for a part-time job to supplement your retirement income.
* Since a person’s Social Security benefits grow by 8% annually, you can also maximize your Social Security check by delaying your benefits until you clock 70 years. This move insures you against longevity and poverty at old age, since you’ll have a fat pay cheque to cover your expenses if you live longer.
Taxes And Retirement: Understanding The Basics
Another important aspect of retirement planning involves controlling your taxes. Mr. David Giertz suggests saving money in diversified accounts because it helps with tax bills. For instance, taxable accounts often come with moderate capital gain tax rates with no specific withdrawal schedule meaning you can make your withdrawals whenever you want to (even before the age of 59�) without any fears of being penalized.
On the other hand, Tax-deferred accounts only charge you income taxes on your withdrawals which must start after the age of 70�. You can also opt for Roth IRAs because they are tax-free and don’t have any minimum distribution requirements, but the contributions are not tax deductible.
David Giertz goes on to say that a person’s tax bracket drops once they enter their retirement period, that’s why it’s wise to make use of retirement accounts that permit deductible contributions. But, If your contributions aren’t deductible, then you should consider contributing to a Roth – a taxable account should be your last resort.
Mr. David Giertz also suggests funding the Roth first for those expecting to be in the same tax bracket they are in or higher. Although it is wise to note that giving Roths more priority is usually necessary if one has a lot of money stashed in their other retirement accounts.
Mr. Giertz is one of the world’s greatest minds and an expert in the progressive financial services industry. With over three decades of experience, he has made jaw-dropping achievements. Over the years, David has worked for numerous companies with a proven track record of growing profit revenue by billions of dollars. Aside from having an impressive resume, he is also well versed in matters concerning financial management and planning.
Find David’s official website here: http://officialdavidgiertz.com/