Road to Retirement
Your Current Retirement Situation
• Old definition: “Withdrawal from one’s position or occupation or from active working life.”
• New definition: “Achieving a state of financial wellness and security so you can live the lifestyle you desire.”
Questions About Retirement
S1
• How do you feel about your current financial situation?
• How do you feel when you make small financial
decisions?
• How do you feel when you make large financial decisions?
• How do you feel when you think about retirement?
• How do you feel when you talk to your loved ones about
money?
Questions About Retirement
S1
Questions About Retirement
S1
• Only invest with risk capital—that is, money you can afford to lose.
• Gain a high-level knowledge base about any investments you’re considering.
• Build a team of trusted advisors.
• Before making any decision, take time to evaluate it logically.
• Reduce the influence of emotions by partaking in an activity that reduces your stress levels.
Tips to Lowering Emotional Stress When Making Financial Decisions
Retirement & Income
S3
Potential Income Sources at Retirement:
• Social Security
• Pension
• Assets
• Annuities
• Employment
• Business Enterprise
Retirement Plans & Taxes
S4
Tax Impact
• Tax-Deferred. Taxes are paid later with tax-deferred investments. You are able to invest the money that the government would have taxed. Tax deferred investments can include 401(k), 403 (b), and IRAs.
• Tax-Deductible. This feature allows a person to deduct the amount invested from their gross income, lowering overall tax liability. Tax-deductible investments can include 401k, 403b, Simplified Employee Pension Plan (SEP), Keogh and IRAs.
• Tax-Free. Provide returns that are free from federal income tax and in some cases, state tax. Roth IRA, municipal bonds and 529 plans – assuming monies are used for schooling – are all examples of tax-free investments.
Retirement Plans & Taxes
S4
Employee-sponsored Retirement Plans
• These types of retirement plans can help you reach your retirement goals.
• These plans are eligible to receive tax benefits from the IRS.
• Generally three types of plan:
o Defined contribution plan based on contribution and investment performance
o Defined contribution plan based on employee’s salary and number of years in the plan
o A combination of the two plans above
Top Related