3 FINANCIAL MOVES TO HELP YOU ROLL INTO RETIREMENT
Planning to leave the 9-to-5 within the next 10 years? These steps can help you make the transition.
It can – and probably will – happen quickly. One day you're adjusting to turning 50. And in what seems like only a few years, you're thinking about the next big adjustment: retirement. Both can be equally shocking events. But at least you can prepare.
Here are three moves to consider as your retirement date continues to close in.
According to a 2013 Vanguard report only 10 to 12 percent of 401(k) participants make the maximum contribution of $19,00 per year. If you're among the majority of Americans who don't, now is the time to maximize your retirement savings. Are you 50 or older? Then you can use what's known as the 401(k) catch-up contribution option. The provision allows you to contribute up to $6,000 more per year – above and beyond the $19,000 limit –to your account.
Key point: Your contributions are made before tax, but your withdrawals are taxed as ordinary income in retirement. Also, these amounts are valid for 2019, but they may be adjusted in the future.
The financial strategies and asset allocations that worked for you in your 20s, 30s and 40s might not be as ideal when you hit your 50s.
It's a good idea to regularly review your overall insurance and investment strategies as you age. The financial strategies and asset allocations that worked for you in your 20s, 30s and 40s might not be as ideal when you hit your 50s.
The key is to work with a qualified financial professional who can examine your portfolio, help determine if it suits your risk tolerance as you age, and, if necessary, adjust your asset allocation. Doing so helps keep your funds in sync with your financial goals and risk tolerance – two factors that stay remarkably constant throughout life. It can also help you feel better about the future knowing you have everything in place for this next stage of life.
Although one of life insurance's primary purposes is to financially protect your family, some policies also build cash value. And certain contracts allow you to withdraw that cash value, which can come in handy when paying for college or other significant expenses. Of course, withdrawing some cash value may reduce the size of the death benefit and the future cash value available.1 But the good news is that withdrawals from the accumulated cash value of your policy may be tax-free up to the amount of the premiums you have paid. The best way to find out for sure is to ask your tax professional – and possibly your attorney, when applicable. While Thrivent does not provide specific legal or tax advice, we can partner with these individuals to help you get a fuller financial picture.
Retirement on the horizon? A Thrivent Financial professional can help you get ready and guide you through the transition.
No matter what stage of your Wise With Money Journey you're in, we can help you explore a wide range of financial products and services to help you reach your goals.
We can help you explore a variety of annuities – tools that offer ways to save for retirement and generate an ongoing income stream.
Permanent life insurance can provide lifetime coverage as long as the required premiums are paid. In addition to providing a death benefit, it can serve as a source of cash to help cover financial needs.
An IRA offers convenience, opportunities and benefits that other savings vehicles don't. Two of the most common types of IRA are traditional and Roth.
MORE TO EXPLORE
Your insurance strategy can help provide protection and flexibility for you and your family. In particular, cash value life insurance can provide a range of options. And getting cash out of your life insurance may be easier than you think.
Change is inevitable. When it happens, life's big events – the celebrations and the disappointments – may be ideal times to consider if the life insurance you have is what you want. And what you need.
You can't necessarily call unexpected expenses "unexpected." They arise for all of us. If you're not prepared for such pitfalls, they can quickly derail your financial life. Having an emergency fund in place can provide valuable protection.
1 Loans and surrenders will decrease the death proceeds and the value available to pay insurance costs which may cause the contract to terminate without value. Surrenders may generate an income tax liability and charges may apply. A significant taxable event can occur if a contract terminates with outstanding debt. Contact your tax advisor for further details. Loaned values may accumulate at a lower rate than unloaned values.
If requested, a licensed insurance agent/producer may contact you, and financial solutions, including insurance, may be solicited.
THRIVENT IS THE MARKETING NAME FOR THRIVENT FINANCIAL FOR LUTHERANS. Insurance products issued by Thrivent Financial for Lutherans. Not available in all states. Licensed agent/producer of Thrivent.