A personal finance blog dedicated discussing such topics as budgeting, asset allocation, 401K, IRA, cash flow, insurance, financial planning, portfolio management, and other areas in personal finance.


Wednesday, June 15, 2005

Ten Steps to a Richer Retirement

Somehow I got on every magazine publisher's list. I get offers from every personal finance and business-related magazine available. Today I got an offer from Kiplinger Retirement. Since I am a subscriber to their regular magazine, it's no surprise I got this offer. Anyway, in the envelope with the offer was a little card titled "10 Steps to a Richer Retirement." It is very common-sense but well worth sharing. So, here there are:

10 Steps to a Richer Retirement

1. Safely Spend Your Savings.

Most experts recommend you can safely spend 4% to 5% of your portfolio in your first years of retirement.

2. Build a Bond Ladder for Steady Income.

This time-tested strategy helps smooth your income regardless of what happens to interest rates.

3. Dividend-Paying Stocks Can Pay Off... In Dividends.

Rising dividends can help you keep up with inflation and help cushion market downturns.

4. Find a Good Parking Place for Your Cash.

Check out for profitable ideas. Earn higher yields on money-markets, CDs, and savings accounts.

5. Get Unbiased Help From a Financial Planner.

Pick a financial planner who doesn't accept commissions from the products they sell.

6. Get a Better Deal When You Buy Municipal Bonds.

Check on the latest prices and yields at Investing in Bonds to make sure you're getting a good deal.

7. Review Your Designated Beneficiaries.

Have you got the right designated beneficiaries on your IRAs, 401(k)s and other retirement-saving plans? You may find that the names are out of date.

8. Determine Whether to Postpone Your First IRA Distribution.

You can hold off taking the first required distribution from your IRA but you'll have to take two withdrawals in the following year. This can bump you into a highter tax bracket.

9. Make the Most of Your IRA and 401(k).

In 2005, the amount you can squirrel away each year into an IRA and 401(k) increases to $4,000 and $14,000, respectively. If you're age 50 or over, you can put away an extra $500 into your IRA and $4,000 into your 401(k).

10. Protect Your Savings With Long-Term Care Insurance.

With health-care and nursing-home cost continuing to increase, consider buying long-term-care insurance to protect you from some of those expenses.

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