Simple Retirement Planning

Planing your retirement might seem as a daunting task for most right now with all the complex plans available to you. An reason for procrastination that I hear a lot from people is that they don’t know where to start. This article is designed to help you understand two options to look further into using to plan your retirement. Instead of giving you all the technical specifications, I’d rather make things simple and recommend two products that can meet multiple needs. Please share this with your friends and family.

Life Insurance Retirement Plans

Thats right! Life insurance is my first recommendation to you, but not because its what I specialize in (I also offer other products as well such as 401k, IRA, 403B, SEP etc.), but because this is so simple to use that a child can understand it. Please remember, instead of piling you up with all the different benefits and features of this plan, I’m going to keep things really simple. Basically, a Life Insurance Retirement Plan can ensure you never outlive your money. You pay your premiums on month after month. Your money does not get invested in Stocks or Bonds thus it is safe from a market drop. You will earn on average 7% interest (during good years it earns 13%) and after approximately 15 years, you can begin accessing your retirement money tax free. So for example, your 30 years old, and you open a Life Insurance Retirement Plan, at age 45, you will have access to a good amount of money you can use to retire, purchase a home, send your child to college etc. Since we are on the topic of retirement planning, you’d obviously want to leave the account alone until its time for you to retire. Oh, and my favorite part is that this particular plan is that it can include Long Term Care Insurance protecting you from any unexpected chronic illness. If your not sure what that is, just remember Superman  actor Christopher Reeves. A strange accident can make you helpless, and thats when Long Term Care Insurance kicks in. It ensures you receive the proper care you need without breaking your bank account. Like I said, this is a simple retirement plan designed to do one thing! Ensure you preserve your quality of life.

Something you should know about these plans is that you can’t access your funds in the first 5 years of the policy without incurring a penalty. This is designed to help you save money instead of using it when ever you have an emergency come up. So if you are serious about starting a retirement plan, consider talking to your accountant or insurance agent about a Life Insurance Retirement Plan.

ROTH IRA

If you want something more traditional, don’t get Traditional IRA! Look somewhere more ta. ROTH IRA differs from other products in the taxation method. Would you rather get taxed now or later? If your answer later, I’d like to ask you to consider this. Taxation today is at an all time low and by looking around, things don’t seem to be getting any better. So you can take the tax penalty today when your young, during a low tax season when you have multiple deductions available that you can declare, or wait until a later day in the future, when taxes might be much higher and your deductions much lower (elderly individuals usually have less deductions available during retirement). The choice is yours, but as for me, I’d rather get taxed today, and not take any changes with the economy. For this reason, I recommend to you ROTH IRA’s. You will pay taxes today so that when you need your money during retirement, taxes will be something of the past. Why stress about it then?

Something you should know about these plans are that you can’t access the funds prior to age 59 1/2. Remember, these are retirement funds as such, you need to respect their rules or you’ll incur a penalty. If you are interested in opening a ROTH IRA, you can do it at any local bank or reach your professional financial planner.

Want to learn more?

There are countless books I can recommend to you but my favorite one is The Power of Zero. This is a great book because it keeps things simple enough for you to understand and make the right decision when it comes to your retirement. If you have any questions, please leave a comment below and I’d do my best to respond promptly!

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