Are You Turning One of These Ages in 2019?

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If you’re turning one of these ages in 2019, take note of what makes them important. Some ages, such as 65, the age at which you qualify for Medicare, require you to apply before your birthday, so it’s important to pay close attention so you don’t miss an important deadline!

Age 50

Once you turn 50, you can make catch-up contributions to your retirement accounts. You can contribute an extra $6,000 per year to a 401(k), 403(b), and 457 plan, $3,000 to a Simple IRA or Simple 401(k), and $1,000 to a traditional IRA.

Age 55

If you leave your job for any reason during the year you turn 55 or after, you can withdraw from your 401(k) penalty-free. This includes retirement, termination, or leaving for another job.

Age 59 ½

If you do not leave your job, retire, or are fired, you must wait until you are 59 ½ to withdraw from your IRA, 401(k), or 403(b) plans without incurring a 10% federal income tax penalty. 457 plans never incur this penalty. Distributions from traditional IRAs, 401(k)s, and other employer-sponsored are taxed as income.

Age 62

At age 62, workers can start receiving Social Security benefits, but if you are working and making over $17,040 a year, they will be reduced by $1 for every $2 earned. It’s often not ideal to start benefits at this age for this reason.

Age 65

Those aged 65 and older qualify for Medicare. You should apply three months before your birthday in order to start benefits on time. If you are already receiving Social Security benefits, you will automatically be enrolled in Medicare Part A, which covers hospital visits, and Medicare Part B, which covers doctor visits, as well as medical and preventative services and procedures.

Ages 65 to 67

Depending on what year you were born, you become eligible for your full Social Security benefits between 65 and 67. For example, those born in 1960 or later will receive full benefits at 67, while those born in 1955 will receive full benefits at 66 and 2 months.

Age 70

At age 70 you can receive more than you full Social Security benefits. This means that you receive 132% of the monthly benefit because you delayed receiving benefits. However, you gain nothing from waiting until any later than 70 to start receiving Social Security benefits.

Age 70 ½

Once you turn 70 ½ you must start taking required minimum distributions (RMDs) from your IRA, 401(k), 403(b), and or 457 plan. RMDs are calculated based on your life expectancy and amount of money in your account. If you are still working after 70 for a company you do not own more than 5% of, you can delay RMDs. You can roll over your traditional IRA or 401(k) into a Roth account, which is not subject to RMDs.

Even if you’re not turning one of these ages this year, it’s helpful to have a full picture of when benefits, RMDs, and penalties apply to you. Creating a retirement plan starts with important information, so you can avoid penalties and get the most out of your benefits.

 We’re here to celebrate all your birthdays and make sure that you are prepared for them with a strong financial plan. Don’t miss these key dates, click here to schedule a no cost, no obligation financial review and start celebrating this year’s birthday early!

How Retirement Could be Different in 2030

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As I wait for the ball in Time Square drop to kick off the start of the new year, I can’t help but think of the changes that will come in the next decade, especially with regards to my retirement. With advancing technology and changing times, it’s hard to predict how things will evolve each year. I worry if I have prepared enough for my retirement, and think about ways in which the world will change when it finally comes time for me to leave the workforce in the next few years. If we take a look at technology and think about the different ways that we are currently advancing, we can try to visualize some ways that retirement might look different in 2030 and be better prepared for the years ahead.

For starters, by 2030, your health should be better monitored. With the rise of fitness tracking devices and rumors of microchips, in 2030 they could possibly track blood pressure, take electrocardiograms and even send 911 alerts if they sense you’re having a medical emergency. Personalized medicine has also been on the rise and should be in full swing by 2030. Medical professionals could possibly provide tailored care for each person’s own unique genetic makeup. This could end up taking some of the uncertainty out of medical bills and help you better estimate the money that you will need to save.

With this, your drug store readers may become a thing of the past, virtual reality glasses becoming more popular and more easily attained, and hopefully with a lower price tag in the next few years. By 2030, your car might even drive itself and drones could drop packages right at your doorstep. If you’ve seen the news lately, you might have heard that both advancements are being tested currently. In the next decade, retirees should no longer have to worry about driving and if you forgot to stop at the pharmacy to pick up your medication, it might be as easy as summoning a drone to your doorstep.

Safety measures will also improve if keys and checks become obsolete. Mobile devices will soon be able to unlock your door and mobile pay will continue to grow. Along with your locks, the rest of your house may also soon rely on technology. Smart homes will become smarter and you may be able to control everything from lights to heat with your phone.

Whatever changes do come in 2019 and beyond, it’s important to be prepared. We are here to create a personalized plan that takes all aspects of your retirement into account. Click here to schedule your complimentary financial review and start the new year prepared.

Start Your Retirement Off on the Right Foot

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Retirement planning can be stressful because there are a lot of things to keep track of. One of the steps that often gets overlooked is announcing to your employer that you are going to retire. This may require writing a letter to explain your plans and goals for the future, while also choosing a date for your last day of work. It is a big step because it signifies the beginning of your retirement journey. So, to start your retirement off on the right foot, try taking some time beforehand to plan your announcement.

Before you start writing your letter and preparing your announcement, first make sure that you have qualified for all of your retirement benefits. This includes checking the amount of pension payments that you are eligible for, looking at your 401(k) plan, and thinking about when you will sign up for Social Security. Another important thing to consider doing before sending your letter, is making sure you have another form of health insurance to avoid any potential gaps in coverage. To help ensure that you are ready to receive your full retirement benefits, it may be a good time to talk with your trusted financial advisor about creating or updating your retirement plan.

After ensuring that all your retirement benefits are in place, it is then time to begin deciding on a retirement date. The key here is to try and give enough time for the company to fill your position, but also to not give more time than is necessary. Some companies could start excluding you from events or important meetings, or even ask you to leave sooner than you suggested. So, make sure that you’re well-prepared to have this tough conversation.

One of the most important aspects of the letter to include is some lines expressing your thanks and appreciation. Giving positive feedback is important to display gratitude to the company and show respect for all they have done for you. This can also be an opportunity to highlight some of your achievements and successes as an employee. Adding this in can help to leave a more favorable impression on the company, so remember, this is not the time to complain or air your grievances with your employer.

As you write your letter, try to start thinking about your future plans and goals. Do you want to consider working part-time or consulting? Are you willing to train a new employee to help with the transition? If so, then you may want to try explaining this to them. Your company may appreciate it if you can come back to help in the busy season or mentor a younger employee. It is also appropriate to tell them why you are leaving. Whether this is to spend time with grandchildren, travel, or care for a family member, your coworkers will be excited to hear about what your future holds.

This is a huge milestone in your life, and it is important that you put thought and care into your decision so that you can start your retirement off on the right foot. But, before you decide to send your letter, you should talk with a trusted financial professional about your personal goals and financial plan for the future. At Peak Financial Freedom Group, we’ll sit down with you one-on-one to discuss your goals, and to help put you on the right path towards achieving them. Click HERE to contact us today and to request your complimentary, no obligation financial review!

Finance Your Retirement Goals

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Finance Your Retirement Goals

As we get older, we start to think (and potentially worry) more and more about where our retirement income will come from. After you leave your job and begin on the journey of retirement, you will rely heavily on guaranteed sources of income. For most people, they assume this will be mainly collecting Social Security. However, there are many other sources that could be the key to living a comfortable retirement lifestyle and finding what works best for you, so that you can help finance your retirement goals. But, also remember that financing them is only one part to the equation, as you have to make certain that you stay focused on your retirement goals.

If you started planning early, you may be able to use your 401(k)s and IRAs to help create a sustainable and dependable source of retirement income. Unfortunately, most Americans have not put enough of their savings into these accounts to rely on them, but there are plenty of other ways to make up the difference and make sure that your bills are paid for with money to spare. One of these ways is with taxable investments. The most important step with investments such as stocks, bonds and mutual funds, is making sure that you diversify your portfolio. How are you dealing with market risk? The benefits of basic diversification can help you to have all of your assets accounted for, while making sure that they all aren’t moving in the same direction all the time.

If you are fortunate to live a long retirement, you also should make sure that your money will last as long as you do. One way to make money in retirement is by selling things you no longer need or renting unused rooms in your home. Renting gives you a steady income each month while selling goods that you no longer need can help clear out clutter and give you some extra cash. You can even expand to online selling platforms such as eBay or Craigslist or sell handmade crafts on a website like Etsy. Lastly, some retirees decide to pick up a part time job. This helps with retirement income, but also can be a great way to spend some time doing what you love. When retirees go back to work part-time, it can be much more relaxing than their full-time positions, thus giving them an opportunity to work in a low stress environment and meet new people.

At Peak Financial Freedom Group, we believe that a successful retirement first starts off with a solid, customized retirement plan. We’ll work together to go over your financial plan to help discover how to best finance your retirement goals for the long road ahead.

Things to Love About Retirement

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Things to Love About Retirement

There’s a lot of things to love about working. You can love your job, your coworkers, and even the daily routine that a standard 9-to-5 job offers. The feeling of work is safe for most people. After over 35 years, you most likely know what you’re doing and you’re probably very good at it. For these reasons, retirement can seem overwhelming to some people. The fear of the unknown is scary and there may still be challenges that await you, but there are also so many things to love about retirement!

First things first, you have more freedom once you retire. So, imagine never having to sit in rush hour traffic, racing to make it to your 9am meeting again or being able to jump on a cross country flight on a whim. You have no deadlines and no morning alarm to answer to. With this, you lose the competitive aspect of a full-time position. You are no longer vying for another promotion or bonus, you finally have time to relax.

There are plenty of other ways to fill your time in retirement. You can join a club or spend time with your children and grandchildren. Some retirees even decide to work part-time or do consulting work on the side. Whatever it may be, there are plenty of different ways to continue earning income during retirement.

But, if these things don’t interest you, retirement is also a great time to catch up on culture. You can sit back with Netflix or some old DVD’s, and catch up on the shows and videos you were too busy to watch while you were working. Retirement is also a great time to give back. You can coach a little league team or volunteer at a soup kitchen. Another idea is becoming a tutor at a local college or university. Giving back can be very rewarding knowing that you are sharing your knowledge and skills with others.

Whatever you decide to do, it’s important that you are living out your dreams, and focusing on your personal goals. This is your time to finally do the things that you always talked about, but never had time for. Write a book, learn to cook, or maybe even travel on a European river cruise. This is the time that you worked so hard for, and as scary as it can be, it can also be great.

If you’re feeling a bit overwhelmed by the idea of retirement, then it may be time to talk to a financial professional who can sit with you and make sure that your retirement plan is complete. CLICK HERE to contact us and schedule a complimentary, no obligation financial review! AtPeak Financial Freedom Group, we can help you update your plan so that you can feel more secure about heading off on your next great journey in discovering all the things to love about retirement.

Use Proper Planning to Help Determine Your Retirement Budget

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Use Proper Planning to Help Determine Your Retirement Budget

The age-old question remains, what percent of your salary do you really need for retirement? Will you need 60% or 90%? Most people think that a reasonable number for retirement is around 70% of their salary. However, the reason people think that this number sounds right, is because it’s the most common guess that people come up with. But, your retirement income shouldn’t be based off of random guessing, you should consider using numbers and proper planning to help determine your retirement budget, and to figure out just how much money you will need based on your personal goals, expected lifestyle and expenses.

When you end up doing the math and proper planning, it will likely turn out that you need much more of your income to live comfortably in retirement, than you had originally anticipated. In some cases, it may be twice the amount that you originally thought, which makes it nearly impossible to prepare for your retirement income without proper planning and saving. The reason that you need so much more money in retirement is because you have more free time to spend your money. And, not to mention the fact that you’ll no longer be earning that steady paycheck. If you worked a 9 to 5 before retiring, then you likely had 8 hours a day where you probably weren’t spending too much money. This time may also have come with perks, like free travel or happy hours sponsored by your employer. Once you are retired, you must fill those hours with activities in which costs can add up quickly. That’s why it’s important to try and keep an eye on your expenses and retirement budget for the long road ahead.

After you begin to get a sense of what activities you’ll be doing during your free time, the first step to figuring out your retirement income is deciding your preferences. There is a big difference from living luxuriously to living modestly. You must budget if you will be going out to eat five nights a week or only one, and decide whether you will be ordering expensive wine or tap water with your meal. To try and better gauge how much money you will need for certain activities, you can break down your spending into seven categories; eating out, digital services, recharge, travel, entertainment and shopping, and basic needs. By setting a budget for yourself within each of these categories, it can help give you a better picture of your spending patterns in retirement.

Take the first step today by clicking HERE to schedule your no cost, no obligation review. Once you decide what your dream retirement looks like, you can get started on fulfilling those dreams by creating a financial plan that takes these dreams and your personal goals into account. At Peak Financial Freedom Group, we can help you figure out how much money you will really need for retirement, and align your actions with your intentions through an actionable and customized plan.