In the year in which you turn 70 ½ years of age, the current IRS guidelines require you to take a Required Minimum Distribution (RMD), by April 1 of the following year, from your Qualified accounts (tax-advantaged accounts). For each year thereafter, you must take your RMD by 12/31 each year.
Retirement planning does not end at retirement. The need to continue to grow assets to produce more cash flow remains important for most.
Just over 1 in 4 of today’s 20 year olds will become disabled before they retire.1 About 20% - or 1 in 5 American adults- have a disability according to the CDC July 2015. The majority of wage earners believe they have a 2% or less chance of being disabled for 3 months or more during their working career, but the actual odds for a worker entering the workforce today are about 25%.1 Medical problems contributed to 62% of all personal bankruptcies filed in the U.S. in 2007.2 None of us know what challenges life will bring and that is why you should consider disability insurance.
Inflation can be defined as an overall upward price movement of goods and services in our economy as measured by the Consumer Price Index (CPI). When planning for how much money you will need for retirement, it is important to consider the impact of inflation on your assets and your goals. Ongoing inflation takes away the buying power of your money, meaning you will need more money to live on in the future than you need currently.
Have you heard of the Stanford Marshmallow Experiment conducted in 1972 by a Stanford University psychologist? In this experiment, children are given a marshmallow and told they would receive a second marshmallow if they could resist eating the first. Scientists studied how long each child resisted the temptation to eat the marshmallow. A long-term study of the children who participated in this experiment showed those who were able to wait for the marshmallow – to defer gratification - were most successful in life.
Time is money—literally. For a recent graduate, time might also seem like an abundant resource, with many thinking they have plenty of time to save for their future – later. The traps of bad credit and debt snare many unsuspecting young adults and cling to their financial history for years.
