Coping with Financial Issues of COVID-19 - Part 22
By Randy Gerard, Personal Financial Counselor, 139th Airlift Wing
/ Published August 21, 2020
ST. JOSEPH, Mo. --
ITEMS OF INTEREST
- UPDATE on HEROES vs. HEALS Acts – As of this morning, 19 August, there is still no bill in place. The politics of the day appear to be taking precedent over agreeing on any package. Hopefully this will be resolved by next week but Congressional recesses and the election are bearing down so actual time in chamber might be compromised. Stay tuned!
- Planning for a Successful Retirement – How “successful” is defined is certainly up to the individual. Some will work longer if physically possible, lower living standards to meet available income, rely on others income/support, etc. The more you plan for your retirement will look like the more flexibility and options you will have. Here are some concepts or suggestions for you to consider:
- Start as early as possible, and be automatic-You’ve all probable seen or heard the story of 2 people, both 25, having the $3,000 to invest annually. One starts at 25 but then stops after 10 years, the other waits 10 years but then contributes until age 65. Both have the same compound annual growth but the one who started at 25 will have more than $100,000 more, even though the other invested three times more than the first ($30,000 vs $90,000). Power of Compounding-make it your friend!
- Identify your goal – Sure, retirement is 10, 20, or even 30 years out, how the heck do you know? First, do the best you can to at least “hang some $$” on the costs of things as you see them now. As an example, estimate your pension will replace 50% of your salary (40% for BRS) and you would need to make up the difference. Some rely on Social Security for most of that, but for my view, save and invest enough to be in control of that difference.
- Be Income Tax Smart – Many I have counseled with that have long careers and associated income levels have realized that most, if not all of their income streams at and during retirement will taxable, at least partially. The proper use of account types and investment options can go a long way in providing considerable taxable income management for retirement.
Estimating or trying to predict future needs is certainly not set in stone as things will change. But if you don’t start planning now, creating as flexible and goal-based plan as possible, you will have made a default plan with future fate.
Don’t hesitate to reach out by phone, email or ask for a private Zoom session for you or your family members.Be Vigilant and STAY SAFE!
Randy Gerard, PFC C (573) 415-6934 O (816) 236-3659 email@example.com