Posts Tagged ‘financial economics’

How Much Money Should You Have in Your Retirement Accounts?

Monday, February 17th, 2014

How much do you need to retire

Saving for retirement can seem so frustrating and out of your hands. There are so many things you can do to make sure you are involved with your own retirement. You can even invest your retirement how you want with a with a self directed account. Self directed accounts can be IRA or 401Ks. What is great about a self directed account is that you can invest in things like real estate and gold. There is plenty of other things you can use your IRA to invest in with a self directed account. If you are worried about invest in the stock market then a self directed account is a great option. Once you have a self directed account then what? Start investing!! Even when investing with a self directed account it is important to remember about your end goal of securing a great retirement.

We have extensively gone over retirement and how to prepare for that ever so exciting, yet potentially stressful time. The more you are prepared for retirement the less stressful it will be. Why is it stressful? It is stressful because if you haven’t prepared well enough then you may be wondering if you have enough money in your retirement accounts? This is what most of us worry about. With a self directed account it isn’t always about how much money is in your accounts but what are your assets worth?  Either way knowing you have enough to get through your retirement without running dry is important. Today we will be discussing how much money you will need when you actually do retire.

As knowing a perfect figure can be quite tricky and each situation can rule different outcomes it is wise to sit down with a financial planner to make sure you are on the correct track for your situation. A few of the factors that need to be considered when looking at your situation are:

When You Retire

When you retire can have a huge impact on your retirement income. Just speaking of when you will start collecting social social security between 62 to 70 can be dramatic. Say you earned $50,000 a year and turned 62 in 2013. You could collect roughly $1,011 a month as a single. If you waited until 66 you would be able to collect roughly $1,420 a month (in today dollars). If you started collecting at 70 you would collect roughly $1,972 a month (as before it is in today dollars).

Where you Retire

$300,000 can go a lot farther in places like Daytona Beach, Florida, Pocatello, Idaho, Greenville, S.C. than it can in San Francisco, California, or New York, New York. Make sure you know the cost of living where you are retiring. You may find that you need to adjust your savings plan depending.

What You Plan To Do While Retired

This is an obvious but often overlooked aspect of retirement. If you plan to continue the same lifestyle that you typically had before retirement you should be ok. If you plan to travel and do things that you never did while working you may need to boost your retirement savings plan.

How Long You’ll Live

This is another huge thing to be aware of when retiring. Of course we never know what is going to happen but you should plan for the long haul. There are different ways you can judge how long you will live. There are expectancy calculators and the IRS has a table to guestimate how long you will live. Using those guestimates you’ll be able to know how long you’re going to need money which will be a great insight to figuring out how much you’ll actually need.
With so many variables that go into figuring out how much you actually need is it even possible to have any idea what I should be saving now? Yes, it is very possible to have a good idea of what you need. There are plenty of calculators that help you with your retirement. There is also a general rule of thumb that can give you a good starting point.
  • Age 35: Have saved as much as your current salary.
  • Age 45: Have three times your salary saved.
  • Age 55: Save at least five times your salary.
  • Age 67: When it’s time to retire, a great goal is to have saved at least eight times your ending salary.
This is a great starting point and if followed can give you a very solid basses for your retirement. It still doesn’t beat out getting as detailed as possible though. Look at every aspect of your life and figure exactly how much you spend and do your best to figure out future spending. Again, the more detailed detailed the plan the better. If you follow that detailed plan you are much more likely to be able to go through retirement lasting on your own money. you need to very wise to dig as deep as you can and to get as detailed as possible.

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Self Directed IRA Accounts – Roth IRA

Friday, February 14th, 2014

Roth IRA

With more than one retirement account option it can be hard to know which account would be best for you. If you are setting up your first or fifth retirement account it can be hard to know which is best for you. The main types of retirement accounts are: Traditional IRA, Roth IRA, 401K plans, 403B plans, SIMPLE IRA plans, SEP plans. Understanding the differences between these types of accounts will help you decide which is right for you. It is also important to know how each one of these differs when you are setting up a self directed IRA or a self directed 401k. Today we will be talking about the basics of a Roth IRA.

Roth IRA Basics

A Roth IRA gives you the ability to save and invest your after-tax dollars, let the investment grow completely tax free, and withdraw your principal and earnings tax-free if the Roth has existed for at least five years. For certain reasons you may be subject to a 10 percent penalty on the earnings if taken before age 59 ½. In other words, once your after-tax dollars go into the Roth, neither those dollars nor any future earnings on the dollars are ever taxed again, a very powerful feature. And, unlike the Traditional IRA, there is no 70-½ years age limit on making contributions, you may make contributions at any age. One thing to remember is that you must have income in order to contribute.  You can’t contribute more than you make nor more than the maximum contribution limit.

Contributions

The deadline to contribute to a Roth IRA for a particular tax year is generally April 15 of the following year. When this date occurs on a weekend or a legal holiday, the following business day becomes the deadline. Tax return extensions do not extend this deadline, it’s always April 15th of the following year. When an individual makes a contribution to his or her Roth between January 1 and April 15, for the previous tax year, this is frequently referred to as a “carryback contribution”. See the page 4 topic “Contribution Rules For Both Roth and Traditional IRAs” for contribution limits.

Withdrawals a.k.a. Distributions

You may make tax-free and penalty-free withdrawals from your Roth IRA if you meet two conditions. First, your Roth IRA must have been open for a minimum of five years. Second, the withdrawal must be made because of the occurrence of one of the following events:
  • You have reached age 59-½
  • The only other way you can take any withdrawls is if you meet the IRS provision which allows partial withdrawals to begin at almost any age and to continue for a specific time frame. This provision is called a 72(t). Some of the exceptions are
    • Your death
    • A disability you incur
    • Your first home purchase
Check out the IRS website for more information about a 72(t)
Distributions or withdrawals that meet the above requirements are referred to as “qualified distributions”. While you may take distributions from your Roth IRA at any time, distributions which are not qualified distributions may be subject to taxes (and in some cases early distribution penalties) to the extent they exceed your combined contributions to the Roth IRA.
You are not required to take withdrawals at age 70-½ or any other age as you are with a Traditional IRA, another very powerful feature. You can leave everything in the Roth, continuing to grow tax free, and pass the Roth after your death on to your heirs also income tax free. However, the amount left in the Roth after death will be subject to estate or other death taxes if the estate is large enough to hit the taxable minimums.

Author: , Self Directed IRA Professional
1.801.683.9291
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MAKE SELF-DIRECTING YOUR NEW YEAR’S RESOLUTION

Thursday, January 9th, 2014

You don’t have to start your resolution on January 1st, but you should start your resolution with the intent of following thorough.  According to StatisticBrain.com, 34% of people make money related resolutions.  How many times have you thought about taking control of your financial future?  About having more money in your retirement?  Well, the beginning of the year is the time to make these thoughts into realities.  The stock market ended on a very strong note and as all financial advisors will tell you, its best to sell high.  This may be the best time to sell those traditional assets like stocks and bonds to invest in something that has the potential to make more money than stocks and bonds can offer.

What are the benefits?

*”Self-Directed” means you have complete control over selecting and directing your investments.  We even offer accounts that give you checkbook control.

*Diversification– Instead of “putting all your eggs in one basket” on Wall Street, a self-directed account offers a plethora of investment options.

*Market Volatility – We have seen the market on Wall Street do dips and drops and downward strides several times this year.  A self-directed account offers many investment options that have much less market volatility.

*Due diligence – As with an investment you should do your due diligence by researching your investment.  Since self-directing offers so many investment options you can research and invest in what you know and enjoy!

*Tax deferred – profits are tax deferred in your retirement account.  When investing in real estate, no 1031 exchanges are ever needed.

*Plus more

Investment options

—  Real Estate

  • Commercial
  • Residential
  • Multi-family
  • Multi-unit
  • Apartment buildings
  • Co-ops
  • Condos
  • Land – Improved or Unimproved
  • Multi-Tenant Shopping Space
  • Anchored Shopping Center
  • And more!

—  Hard money lending

—  Precious Metals

  • Gold
  • Silver
  • Platinum
  • Bullion coins

—  Private placements or offerings

  • Oil & gas
  • Real estate
  • Ownership interests in privately held businesses and business entities, etc.

—  Trust Deeds

—  Tax Liens

—  Funding a Start-Up Business

And Many Others!

What type of money can be used?

You can roll several types of accounts into a self-directed IRA.

  • Most type of retirement accounts:
    • 401(k)
    • 403(b)
    • Profit Sharing Plans
    • Keogh
    • Qualified Annuities
    • Money Purchase Plans
    • Cash Balance Pension Plans
    • Defined Benefit Pension Plans.
    • IRA accounts:
      • Traditional IRA
      • SIMPLE IRA
      • Roth IRA
      • SEP-IRA
      • Inherited IRAs
      • Plus more, like Coverdale Education Savings

How to get started?

The process is simple.  Visit our website to learn about the self-directed world.  You can watch videos, read brochures, learn about the different types of accounts and investments available when self-directing.  While you are on our website, you can chat with one of our IRA Specialist.  Or, you can give me a call directly so we can discuss your investment goals and decide which self-directed account best fits your situation.

HAPPY NEW YEAR!  And congratulations on starting this year by taking control of your financial future!

Author:

Jaclyn M. Grella

Find Accuplan: www.Accuplan.net FACEBOOK TWITTER GOOGLE PLUS YOU TUBE

Is a Gold Backed IRA Right for You?

Monday, January 6th, 2014

Gold Backed IRA

An IRA is a great retirement account for anyone looking to grow their retirement nest egg over the span of your career. It makes saving even more advantageous because of the tax advantages that come with an IRA.

There are different types of IRAs including: Traditional, Roth, SEP, and Simple accounts. Each one of these accounts allows you to invest in the same types of investments. If you have a self directed IRA your investment options are broader. You have the option of a gold backed IRA, other precious metals IRA, real estate IRA and can even invest in other businesses.

When investing for your retirement plan you may be worried about the types of investments that are in your IRA. You could possibly be worried about inflation or even the stock market. Investing in something a little more stable and less risky is probably something you should do.

What about a gold IRA? Gold has proven to be the perfect hedge against inflation. It is also a great way to hold a real asset in your IRA rather than just a paper asset. Wether you buy gold or any other type of metal your precious metals IRA will have actual metal in your IRA. If the cost of the metal goes down you still have the same amount of metal in your IRA it is just worth less. Nor is the value of gold, silver or other precious metals to likely be valued at $0. It is possible though for the stocks you purchased to be worth $0 if the investment goes bad or company goes under. This sort of stability is exactly what some people are looking for in their IRA. Maybe you don't want all of your IRA invested in gold but would like a portion, that is totally fine. In fact, it is very wise because you are diversifying your portfolio.

Do you still have questions about a gold backed IRA? Let's dive into some of the more commonly asked questions in regards to gold backed IRAs.

What is a Gold Backed IRA?
It is merely a self directed IRA that follows IRS rules and regulations that allows you to hold physical gold in your retirement plan. Thus, giving you the peace of mind that your retirement is invested in something less risky than many of the alternatives.

Can I Invest in Any Type of Gold or Precious Metal with my IRA?
There are restrictions as to what types of precious metals can be in an IRA. To find out more about the actual types of metals that are allowed check Gold IRA FAQ

Can I Have Other Types of Investments in my Gold Backed IRA?
Yes, in your self directed IRA you can have other types of investments. Whether they be gold IRA, real estate IRA or something different. More than one type of investment in your self directed IRA is allowed.

If I Want to Transfer or Rollover My Current Plan Do I Have to Transfer/Rollover my Whole Amount?
No you do not. As I have mentioned before this is a great option as it allows you to diversify your account.

What are the Penalties/Taxes That I have To Pay When Transferring My IRA?
There are none when you transfer from a traditional IRA to a gold IRA.

I Would Like to Physically Hold the Gold, Is That Ok?
No! You cannot take physical possession of your gold. You must store the gold at an insured IRS approved depository in your name until you reach 59 1/2 years of age. You then can take the physical possession of the gold without penalties. If you do before you will be taxed.

One great thing about a gold backed IRA is that it is very easy to set up.  To learn more about how to set one up and the associated fees read Setting up a Gold Backed IRA

You may have more questions about gold backed IRAs and feel free to ask them below or contact us at Accuplan Benefits Services.

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