Damian J. Sylvia
Retirement Income Solutions
220 Monmouth Road
Oakhurst, NJ 07755
Showing posts with label Broker. Show all posts
Showing posts with label Broker. Show all posts
Monday, May 16, 2016
Buying a Home With Retirement Savings: Pros and Cons
If you've been socking money away in a retirement account and are ready to buy a home, you could tap into that savings to boost your buying power. There are several ways to use retirement funds to put a down payment on a home.
Sunday, August 16, 2015
Don’t be too generous with your retirement cash
We hear a lot these days about the strains on the sandwich generation, those caught between the demands of their children and their aging parents. Yet a recent study suggests these intergenerational demands aren’t always equal: while children can strain middle-aged pocketbooks, aging parents generally don’t.
Indeed, older family members are more often on the giving end than on the receiving end of financial support, according to a recent study by the Employee Benefit Research Institute (EBRI). The goal with familial cash transfers is to make sure they’re based on math, not emotion, so they don’t endanger the giver’s near-term finances or retirement security, experts say.
Indeed, older family members are more often on the giving end than on the receiving end of financial support, according to a recent study by the Employee Benefit Research Institute (EBRI). The goal with familial cash transfers is to make sure they’re based on math, not emotion, so they don’t endanger the giver’s near-term finances or retirement security, experts say.
Damian Sylvia
Retirement Income Solutions
220 Monmouth Road,
Oakhurst, NJ 07755
Thursday, June 11, 2015
How To Play Catch-Up For Retirement At 50 Or Older
Are you farther along in your career than you are in your retirement planning? If so, you’re not alone: 42% of people in their 50s surveyed for a recent Transamerica Center For Retirement Studies report said they expect their standard of living to decline after they retire. But no matter how far behind you may be, you can still improve your retirement prospects, if you go about it the right way.
Continue reading the source article at www.realdealretirement.com.
Damian J. Sylvia,
Managing Partner
Retirement Income Solutions
220 Monmouth Road
Oakhurst, NJ 07755
Friday, May 29, 2015
Many Americans have no retirement savings: Fed survey
Many Americans are not financially prepared for retirement, with almost a third of working adults without savings or a pension, according to a Federal Reserve survey published on Wednesday.
The Fed's 2014 Survey of Household Economics and Decisionmaking found that about 38 percent of the more than 5,800 respondents have either no intention to retire or plan to keep working for as long as possible.
The Fed's 2014 Survey of Household Economics and Decisionmaking found that about 38 percent of the more than 5,800 respondents have either no intention to retire or plan to keep working for as long as possible.
Damian Sylvia
Retirement Income Solutions
Tuesday, May 5, 2015
Traditional retirement possibly becoming a thing of the past
It may be time to redefine retirement.
A new survey of American workers from the Transamerica Center for Retirement Studies found that 82% of the respondents age 60 and older either are, or expect to keep working past the age of 65. Among all workers, regardless of age, 20% expect to keep on working as long as possible in their current job or a similar one.
A new survey of American workers from the Transamerica Center for Retirement Studies found that 82% of the respondents age 60 and older either are, or expect to keep working past the age of 65. Among all workers, regardless of age, 20% expect to keep on working as long as possible in their current job or a similar one.
Damian Sylvia
Managing Partner,
Retirement Income Solutions
Sunday, April 19, 2015
Heartbreaking Reasons To Save Outside Of A 401k, 403b, Or IRA For Retirement
An advisor friend recently shared two frightening withdrawal requests from retired clients. The first was an $85,000 call for funds to cover rehab costs for an adult child. The lethal combination of depression and alcohol abuse contributed to suicidal thoughts, an inconsistent medication schedule, and a trail of hospital stays and doctor visits. The center treating this individual is among the few that address both mental health issues and addiction, which comes with a hefty price tag.
Damian Sylvia
Managing Partner
Retirement Income Solutions
Thursday, April 16, 2015
Retirement: The payoffs of an active lifestyle
Some people are planning ahead for their physical fitness in retirement just like they plan for their financial fitness, says one of the country's top national diet and exercise experts. And that's as it should be, he says.
If you start a few years before retirement, says James Hill, executive director of the the University of Colorado Anschutz Health and Wellness Center in Aurora, Colo., you'll be ready to go when you do retire; most people can make a lot of progress toward getting in better shape in a matter of a few months.
Damian Sylvia
Managing Partner
Retirement Income Solutions, LLC
Thursday, March 26, 2015
Why post-retirement planning is harder than ever
You have heard the exhortations to save, save, save. Perhaps you have even managed to sock away a decent retirement nest egg. If so, good for you.
But do you have a plan for how to draw down that money?
For millions of Americans, the answer is no. While 401(k) plans usually offer a defined array of investment choices, online tools and other guidance, there is no such system in place for when workers retire.
But do you have a plan for how to draw down that money?
For millions of Americans, the answer is no. While 401(k) plans usually offer a defined array of investment choices, online tools and other guidance, there is no such system in place for when workers retire.
Damian J. Sylvia
Managing Partner
Retirement Income Solutions
5 ways to beef up your retirement savings
Research shows that many people are worried about having enough money saved for retirement.
Some don't think they'll be able to live comfortably with what they have tucked away, and even those with significant savings fear going broke, one survey showed.
But take heart. Financial experts have given this problem a lot of serious thought, and in today's special report, we look at five ways to beef up your retirement savings.
Some don't think they'll be able to live comfortably with what they have tucked away, and even those with significant savings fear going broke, one survey showed.
But take heart. Financial experts have given this problem a lot of serious thought, and in today's special report, we look at five ways to beef up your retirement savings.
Damian J. Sylvia
Managing Partner
Retirement Income Solutions
Sunday, March 22, 2015
The Best Way To Invest For Retirement
Turn on CNBC for two minutes and it’s easy to believe you need to stop everything and invest in the hot stocks the “experts” are recommending and get out — NOW! — of the ones they’re bearish about.
Chris Minnucci, author of the ironically titled The Death of Buy and Hold: How Not to Outlive Your Money — Investing for, and in, Retirement, says do so at your own peril.
Chris Minnucci, author of the ironically titled The Death of Buy and Hold: How Not to Outlive Your Money — Investing for, and in, Retirement, says do so at your own peril.
Damian Sylvia
Managing Partner
Retirement Income Solutions
Tuesday, March 17, 2015
5 Ways to Know If You’re on Track to Retire Early
More than any numerical calculation, your financial behaviors are a reliable indicator for early retirement.
Interested in retiring early? How do you know if you’re on track? The usual answer is a financial formula: A given amount of savings, plus some investment return, equals a certain lifestyle, for a certain number of years. It’s simple math. Or is it?
Damian Sylvia
Managing Partner
Retirement Income Solutions
Saturday, March 14, 2015
'Boomerang Kids' Are Ruining Their Parents' Retirement
Having your adult children living in your basement is worse than you think. Boomerang kids can actually hurt your chances of a sound retirement.
Those 65 years or older with financially independent children are more than twice as likely to be retired than people of the same age group who financially support their adult children, according to a new report that retirement market research firm Hearts & Wallets shared with CNBC.com.
That's because those who are still supporting their kids are often putting off retirement to do so, said Hearts & Wallets co-founder Chris Brown.
Damian J. Sylvia
Tuesday, March 10, 2015
Saved $1 million and living my dream retirement
Roy Nash long dreamed of retiring at the age of 55.
A self-taught investor, he diligently stashed all the savings he could in stocks and mutual funds. So by 2009, when he did turn 55, he says he had more than $800,000 saved -- enough to step away from his nearly three decade long career at a natural gas distributor in St. Louis.
Damian Sylvia
Retirement Income Solutions
Tuesday, March 3, 2015
Making Gifts Sooner Than Later ... Accelerating Charitable Bequests
This article is by Brian Kaplan of Synergy Life Brokerage Group LLC. Damian Sylvia of Retirement Income Solutions was given permission by Brian Kaplan to repost the entire article.
Over the last few years, the estate and financial planning community has adjusted its use of various planning tools and techniques to reflect the reality of significantly higher exemptions from federal estate taxes beginning in 2011.
For 2012, the most recent year that both Internal Revenue Service and national death statistics are available, some 2.543 million Americans passed away. Of that group, just 8,423 estates exceeded the $5.12 million threshold for gift and estate tax exemptions. This figure means that 99.7 percent of decedents in 2012 weren’t subject to federal transfer taxes. While 19 states and the District of Columbia impose estate or inheritance taxes, just 38 percent of Americans reside in these jurisdictions. The states that don’t impose such taxes include a number of highly populous ones, such as California, Florida and Texas.
So, what does this new paradigm mean?
Non-Tax Motivations
This new estate tax reality means that planners will increasingly need to consider the non-tax motivations that have always, in reality, been of great importance in the decision-making process underlying testamentary charitable gifts. The majority of gifts through estates have always come from those who make these decisions from more deeply held beliefs and motivations than simply the desire to reduce estate taxes.
According to Giving USA, the total bequest giving of $27.7 billion in 2013 was the second highest total on record, and more than half of that amount came from non-taxable estates.
Family members, close friends, associates and charities are the primary entities found in wills or other estate plans. It could be said, therefore, that when an individual includes a charity in an estate plan, he’s, in effect, elevating that charity to the status of a family member. This inclusion typically requires a great deal of donative intent.
But, does this insight mean that philanthropically inclined individuals should disregard tax considerations when they decide the most effective ways to make gifts at death? No, but planners should take a broader view of a client’s tax situation when planning these charitable gifts.
In many cases, it may appropriate to broaden the discussion with the client to include income tax issues and other concerns, such as the desire to protect assets, provide income for himself and/or loved ones and other desirable outcomes that can result from more effective philanthropic estate planning.
Let’s look at some of the benefits of “accelerating” estate gifts.
Life Income Gifts
Charitable individuals will often indicate a desire to make gifts larger than ones they believe they can prudently make. The reasons they don’t make these gifts, typically, revolve around a number of common concerns, including fears that they’ll die before taking care of loved ones; outlive their resources; or suffer debilitating illness or economic reversals.
Fortunately, many planning tools have evolved that make these seemingly impossible gifts possible. Also, immediate tax benefits associated with these gifts may largely “replace” the estate tax savings that, in many cases, are no longer available given higher estate tax thresholds.
For example, take the case of Jeffrey. He’s a childless widower, age 79, with $5 million in assets. He’s planning to leave $4 million to his nieces and nephews and the residue of his estate, estimated at $1 million, in equal shares to two charitable interests—one that he’s supported over time and the other to his late wife’s favorite charity. In today’s tax environment, this $1 million residuary testamentary gift would result in no federal estate tax savings.
Jeffrey owns securities worth $500,000 with a cost basis of $150,000. These securities yield dividends of 1 percent, or $5,000 per year. A sale to diversify these holdings may result in capital gains taxes of as much as $52,500 at the federal level and, possibly, more at the state level. He’s, understandably, reluctant to sell and diversify these assets.
Charitable Remainder Unitrust
What alternatives might he consider? If he were to fund a 5 percent charitable remainder unitrust (CRUT) using the appreciated securities, his income would increase from $5,000 to $25,000 the first year, with the possibility that it could grow with the value of underlying trust assets over time. No capital gains tax would be due at the time he funds the trust, and the trust, as a tax-exempt entity, won’t be liable for tax on future capital gains or on its undistributed ordinary income.
Given his age and current federal discount rate of 2.2 percent, Jeffrey would be entitled to an immediate charitable income tax deduction equal to 66 percent of the amount transferred, or $331,000. In his 28 percent tax bracket, this alternative could save him just under $93,000 in federal income taxes over a period of as long as six years, depending on his adjusted gross income and gifts of appreciated assets he may have made in the past.
From Jeffrey’s perspective, he’s increased his spendable income without incurring capital gains taxes, while enjoying capital gains and income tax savings that could exceed $145,000 over time. While he can’t recover the funds in the trust, these assets are also beyond the reach of creditors or individuals who might take advantage of him in later years. The charity that’s the remainder beneficiary will enjoy the knowledge that it will benefit from the remainder of the trust and will receive the funds without them being encumbered by the expense and delay of probate.
Another aspect of interest to Jeffrey’s asset managers is the ability to diversify the assets on a tax-free basis inside the trust and continue to actively manage the assets for the remainder of Jeffrey’s life.
Fixed Income Alternatives
Suppose Jeffrey is also interested in assuring a source of fixed income for the remainder of his lifetime. In this case, he might also decide to transfer $500,000 in low yielding cash to his wife’s charitable interest to fund a charitable gift annuity (CGA) that would make annual fixed payments to him of 6.6 percent, or $33,000, for the remainder of his lifetime. Depending on a number of factors, he might instead choose to fund a charitable remainder annuity trust (CRAT) that would make payments of the same or a similar amount. This option would allow his current advisors to continue to managed these funds.
Whether in the form of a CGA or CRAT paying 6.6 percent, this gift would give rise to a charitable deduction of 48 percent of the gift amount, or $242,000. While he may not be able to use a deduction of this size in addition to the deduction for the CRUT, if he chose the CGA option, some 79 percent of his annual payments would be received tax-free as return of his investment in the contract for a period of his life expectancy of 10 years. Income from a CGA may be taxed more favorably than a CRAT in the near term, while the CRAT may be the better option if he lives beyond his life expectancy.
In any event, the combination of these two types of gifts would afford him a balance between a higher fixed income from the gift annuity or CRAT and a source of income that can grow over time with the performance of assets in his CRUT.
Through the interplay of these two gifts, each charity has the knowledge that it’s the irrevocable beneficiary of a gift that will result in eventual benefits in the range of $500,000, depending on the performance of the trust assets and the underlying gift annuity reserve fund.
In each case, the funds aren’t subject to claims or creditors or possible erosion that could reduce the amount of a residuary bequest if Jeffrey continued with his current plan to leave the funds in the form of a bequest via his will or other testamentary vehicle.
It’s also possible that Jeffrey may decide at a future point that he no longer needs the income from the life income gifts he’s established. In this case, he could decide to relinquish his right to all or a portion of his remaining income interests and allow his gifts to fully or partially come to fruition during his lifetime. He’d then enjoy additional tax savings through deducting the value of the remaining income interest he’s foregone.
Endowments
Along the same lines, Jeffrey might decide to use a portion of his payments each year to begin funding an endowment. In a variation on a “virtual endowment,”5 he might give a portion of his $58,000 in additional income each year to start his endowments during his lifetime. This commitment could be made revocable, so that he makes this decision on a year-by-year basis.
For example, if the charities would eventually spend 4 percent of the combined $1 million in endowment, or $40,000 per year, a portion of Jeffrey’s additional income each year could be directed toward making a part of that spending an immediate reality. He’d report the income each year, but it would be offset by a corresponding charitable deduction subject to any normal deduction limits.
Finally, it’s not unusual for donors who may have made a bequest commitment to a charitable interest at a younger age (when they had many years ahead of them and worried about outliving resources, for example), to decide in later years that they can actually afford to make an outright gift.
In Jeffrey’s case, he and his deceased spouse may have each made $500,000 bequest commitments in campaigns conducted by their charitable interests 15 years ago, when they were in their mid-60s. Now that he’s 79 and has survived his wife, he may decide to make an immediate $500,000 pledge to each of the charities involved and pay $100,000 toward each pledge annually for five years.
This pledge would reduce his estate by $1 million over the 5-year payment period, assuming his remaining assets didn’t grow, but at his age, he could reasonably assume that the remaining $4 million would be sufficient to see him through the remainder of his lifetime. From a tax planning perspective, Jeffrey could realize as much as $280,000 in federal income tax savings as a result of fulfilling the two pledges.
These are just a few of the ways Jeffrey might choose to “accelerate” his charitable bequest to provide him with significant tax and other financial benefits, while also putting the eventual charitable recipients potentially in a better position with a more predictable gift expectancy.
In today’s environment of higher income and capital gains taxes and lower transfer taxes at death, we believe the time may right for many charitably inclined individuals to consider ways to structure gifts that provide greater benefits to all concerned.
For 2012, the most recent year that both Internal Revenue Service and national death statistics are available, some 2.543 million Americans passed away. Of that group, just 8,423 estates exceeded the $5.12 million threshold for gift and estate tax exemptions. This figure means that 99.7 percent of decedents in 2012 weren’t subject to federal transfer taxes. While 19 states and the District of Columbia impose estate or inheritance taxes, just 38 percent of Americans reside in these jurisdictions. The states that don’t impose such taxes include a number of highly populous ones, such as California, Florida and Texas.
So, what does this new paradigm mean?
Non-Tax Motivations
This new estate tax reality means that planners will increasingly need to consider the non-tax motivations that have always, in reality, been of great importance in the decision-making process underlying testamentary charitable gifts. The majority of gifts through estates have always come from those who make these decisions from more deeply held beliefs and motivations than simply the desire to reduce estate taxes.
According to Giving USA, the total bequest giving of $27.7 billion in 2013 was the second highest total on record, and more than half of that amount came from non-taxable estates.
Family members, close friends, associates and charities are the primary entities found in wills or other estate plans. It could be said, therefore, that when an individual includes a charity in an estate plan, he’s, in effect, elevating that charity to the status of a family member. This inclusion typically requires a great deal of donative intent.
But, does this insight mean that philanthropically inclined individuals should disregard tax considerations when they decide the most effective ways to make gifts at death? No, but planners should take a broader view of a client’s tax situation when planning these charitable gifts.
In many cases, it may appropriate to broaden the discussion with the client to include income tax issues and other concerns, such as the desire to protect assets, provide income for himself and/or loved ones and other desirable outcomes that can result from more effective philanthropic estate planning.
Let’s look at some of the benefits of “accelerating” estate gifts.
Life Income Gifts
Charitable individuals will often indicate a desire to make gifts larger than ones they believe they can prudently make. The reasons they don’t make these gifts, typically, revolve around a number of common concerns, including fears that they’ll die before taking care of loved ones; outlive their resources; or suffer debilitating illness or economic reversals.
Fortunately, many planning tools have evolved that make these seemingly impossible gifts possible. Also, immediate tax benefits associated with these gifts may largely “replace” the estate tax savings that, in many cases, are no longer available given higher estate tax thresholds.
For example, take the case of Jeffrey. He’s a childless widower, age 79, with $5 million in assets. He’s planning to leave $4 million to his nieces and nephews and the residue of his estate, estimated at $1 million, in equal shares to two charitable interests—one that he’s supported over time and the other to his late wife’s favorite charity. In today’s tax environment, this $1 million residuary testamentary gift would result in no federal estate tax savings.
Jeffrey owns securities worth $500,000 with a cost basis of $150,000. These securities yield dividends of 1 percent, or $5,000 per year. A sale to diversify these holdings may result in capital gains taxes of as much as $52,500 at the federal level and, possibly, more at the state level. He’s, understandably, reluctant to sell and diversify these assets.
Charitable Remainder Unitrust
What alternatives might he consider? If he were to fund a 5 percent charitable remainder unitrust (CRUT) using the appreciated securities, his income would increase from $5,000 to $25,000 the first year, with the possibility that it could grow with the value of underlying trust assets over time. No capital gains tax would be due at the time he funds the trust, and the trust, as a tax-exempt entity, won’t be liable for tax on future capital gains or on its undistributed ordinary income.
Given his age and current federal discount rate of 2.2 percent, Jeffrey would be entitled to an immediate charitable income tax deduction equal to 66 percent of the amount transferred, or $331,000. In his 28 percent tax bracket, this alternative could save him just under $93,000 in federal income taxes over a period of as long as six years, depending on his adjusted gross income and gifts of appreciated assets he may have made in the past.
From Jeffrey’s perspective, he’s increased his spendable income without incurring capital gains taxes, while enjoying capital gains and income tax savings that could exceed $145,000 over time. While he can’t recover the funds in the trust, these assets are also beyond the reach of creditors or individuals who might take advantage of him in later years. The charity that’s the remainder beneficiary will enjoy the knowledge that it will benefit from the remainder of the trust and will receive the funds without them being encumbered by the expense and delay of probate.
Another aspect of interest to Jeffrey’s asset managers is the ability to diversify the assets on a tax-free basis inside the trust and continue to actively manage the assets for the remainder of Jeffrey’s life.
Fixed Income Alternatives
Suppose Jeffrey is also interested in assuring a source of fixed income for the remainder of his lifetime. In this case, he might also decide to transfer $500,000 in low yielding cash to his wife’s charitable interest to fund a charitable gift annuity (CGA) that would make annual fixed payments to him of 6.6 percent, or $33,000, for the remainder of his lifetime. Depending on a number of factors, he might instead choose to fund a charitable remainder annuity trust (CRAT) that would make payments of the same or a similar amount. This option would allow his current advisors to continue to managed these funds.
Whether in the form of a CGA or CRAT paying 6.6 percent, this gift would give rise to a charitable deduction of 48 percent of the gift amount, or $242,000. While he may not be able to use a deduction of this size in addition to the deduction for the CRUT, if he chose the CGA option, some 79 percent of his annual payments would be received tax-free as return of his investment in the contract for a period of his life expectancy of 10 years. Income from a CGA may be taxed more favorably than a CRAT in the near term, while the CRAT may be the better option if he lives beyond his life expectancy.
In any event, the combination of these two types of gifts would afford him a balance between a higher fixed income from the gift annuity or CRAT and a source of income that can grow over time with the performance of assets in his CRUT.
Through the interplay of these two gifts, each charity has the knowledge that it’s the irrevocable beneficiary of a gift that will result in eventual benefits in the range of $500,000, depending on the performance of the trust assets and the underlying gift annuity reserve fund.
In each case, the funds aren’t subject to claims or creditors or possible erosion that could reduce the amount of a residuary bequest if Jeffrey continued with his current plan to leave the funds in the form of a bequest via his will or other testamentary vehicle.
It’s also possible that Jeffrey may decide at a future point that he no longer needs the income from the life income gifts he’s established. In this case, he could decide to relinquish his right to all or a portion of his remaining income interests and allow his gifts to fully or partially come to fruition during his lifetime. He’d then enjoy additional tax savings through deducting the value of the remaining income interest he’s foregone.
Endowments
Along the same lines, Jeffrey might decide to use a portion of his payments each year to begin funding an endowment. In a variation on a “virtual endowment,”5 he might give a portion of his $58,000 in additional income each year to start his endowments during his lifetime. This commitment could be made revocable, so that he makes this decision on a year-by-year basis.
For example, if the charities would eventually spend 4 percent of the combined $1 million in endowment, or $40,000 per year, a portion of Jeffrey’s additional income each year could be directed toward making a part of that spending an immediate reality. He’d report the income each year, but it would be offset by a corresponding charitable deduction subject to any normal deduction limits.
Finally, it’s not unusual for donors who may have made a bequest commitment to a charitable interest at a younger age (when they had many years ahead of them and worried about outliving resources, for example), to decide in later years that they can actually afford to make an outright gift.
In Jeffrey’s case, he and his deceased spouse may have each made $500,000 bequest commitments in campaigns conducted by their charitable interests 15 years ago, when they were in their mid-60s. Now that he’s 79 and has survived his wife, he may decide to make an immediate $500,000 pledge to each of the charities involved and pay $100,000 toward each pledge annually for five years.
This pledge would reduce his estate by $1 million over the 5-year payment period, assuming his remaining assets didn’t grow, but at his age, he could reasonably assume that the remaining $4 million would be sufficient to see him through the remainder of his lifetime. From a tax planning perspective, Jeffrey could realize as much as $280,000 in federal income tax savings as a result of fulfilling the two pledges.
These are just a few of the ways Jeffrey might choose to “accelerate” his charitable bequest to provide him with significant tax and other financial benefits, while also putting the eventual charitable recipients potentially in a better position with a more predictable gift expectancy.
In today’s environment of higher income and capital gains taxes and lower transfer taxes at death, we believe the time may right for many charitably inclined individuals to consider ways to structure gifts that provide greater benefits to all concerned.
Saturday, February 28, 2015
5 Retirement Planning Items you Should Take Care of Now
I am amazed at how many people I meet who haven't prepared properly for their retirement, a time of life when you will go without earned income — potentially for decades.
Whether you are your own financial adviser, embarking on this project alone or you have procured the help of a professional adviser, there are numerous considerations you will need to address. All of them will take time to think through and give due consideration before making final decisions.
Here are five important issues, often over looked, which will require your attention during your preplanning:
Damian Sylvia
Retirement Income Solutions
Friday, February 27, 2015
The proven way to retire rich
Last year, the National Bureau of Economic Research with professors from the University of Pennsylvania, George Washington University, and North Carolina State University, released a study entitled "Financial Knowledge and 401(k) Investment Performance."
In it the authors found that individuals who had the most financial knowledge -- as measured through five questions about personal finance principles -- had investment returns that were on average 1.3% higher annually -- 9.5% versus 8.2% -- than those who had the least financial knowledge.
In it the authors found that individuals who had the most financial knowledge -- as measured through five questions about personal finance principles -- had investment returns that were on average 1.3% higher annually -- 9.5% versus 8.2% -- than those who had the least financial knowledge.
Damian Sylvia
Retirement Income Solutions
Thursday, February 26, 2015
Is it ever a good idea to tap into your 401(k) early?
Your retirement savings are intended (obviously) for retirement, but what if you need them now? The IRS offers some provisions for withdrawing savings from an IRA or 401(k) before retirement age without incurring a penalty—and President Barack Obama recently added another hardship option in his budget proposal. But that doesn't mean it's a wise move.
A new white paper from the Center for Retirement Research at Boston College estimates that about 1.5 percent of assets "leak" out of 401(k)s and IRAs each year, on average, through early withdrawals, cash-outs or loans.
A new white paper from the Center for Retirement Research at Boston College estimates that about 1.5 percent of assets "leak" out of 401(k)s and IRAs each year, on average, through early withdrawals, cash-outs or loans.
Damian J. Sylvia
Retirement Income Solutions
Wednesday, February 25, 2015
Retirement: Why small-business owners don't save
Baby Boomers are becoming entrepreneurs at an amazing pace. By some accounts they are starting 50% of new businesses. The U.S. Small Business Administration says more than 5 million Boomers 55 and older either own businesses or are self-employed.
There are plenty of reasons for this rush to entrepreneurship: They have the skills, they have the dreams and many aren't ready to retire. Also, many don't think they have opportunities to continue to work in Corporate America once they get to a certain age.
There are plenty of reasons for this rush to entrepreneurship: They have the skills, they have the dreams and many aren't ready to retire. Also, many don't think they have opportunities to continue to work in Corporate America once they get to a certain age.
Damian J. Sylvia
Retirement Income Solutions
Monday, February 23, 2015
Retirement: 5 tips on how to save $1 million
One million bucks is a lot of money. It certainly is impressive if you're one of the few who has saved that much for retirement — looking at your statement and seeing all those zeros.
And even financial planners who say you might need more for your retirement can't argue that it is an impressive start. After all, people are living longer; you may have unanticipated health care costs; and you really want to maintain that standard of living you are accustomed to.
So, here are five tips for saving a cool million by the time you retire.
And even financial planners who say you might need more for your retirement can't argue that it is an impressive start. After all, people are living longer; you may have unanticipated health care costs; and you really want to maintain that standard of living you are accustomed to.
So, here are five tips for saving a cool million by the time you retire.
Damian J. Sylvia
Retirement Income Solutions
Saturday, February 21, 2015
Should You Save More For Retirement Or Pay Off Your Mortgage Early?
One of the most common questions we get is whether to put savings toward paying off a mortgage vs. investing more for retirement. This question is tricky because the answer can vary depending on which stage of life you’re in. Are you in the accumulation phase of trying to build wealth or in the distribution phase of using that wealth to generate income?
The Accumulation Phase
First of all, make sure you have an adequate emergency fund before paying down your mortgage. While paying down your debt may make you feel safer, it’s actually safer to have some money in savings that you can use to continue making those mortgage payments should Murphy’s Law kick in. Even if your mortgage is paid off, you’ll need emergency savings to keep the lights on, food on the table, your car in the driveway, and gas in that car if something happens to you.
Damian J. Sylvia
Managing Partner
Retirement Income Solutions
Subscribe to:
Posts (Atom)