One of the major components of the personal financial planning process is Retirement Planning. After all, we all want to have enough money so that we can retire comfortably and not all of us will win the lottery. In addition to having enough money to be able to retire, many of us also want to retire early. However, children, vacations, cars, houses and food require current uses of our resources that may otherwise be available for our "golden years". Also, retirement seems so distant that we tend not to focus on saving for retirement. We opt to utilize our available resources now instead of saving and investing for retirement.
In creating this retirement plan, we will focus on 3 key areas:
- Your financial needs during retirement
- Your income sources during retirement
- Are you currently saving enough
As an additional note, we will allow you to create this plan for you to both include and exclude Social Security income. As a paranoid individual, I personally do not include any income in my own retirement plan, but we will provide you the ability to include this in your plan.
If you're ready to get started, click 'Get Started' below, if you'd like more general information on retirement and other personal finance topics, click on 'Not Ready' below.
Before we get started there's a little bit of information that you'll need access to. Some of it should be "real information" like how much your investments are worth, but some of it will be projections based on things that you may or may not currently know. For those, we will give you some suggestions, but since every situation is completely different you may want to consult with a financial professional (preferably one that's not trying to sell you something).
Here's what you'll need to know:
- Retirement Assets. This would be the current value of your 401(k)/403(b) plans, your IRAs, your roll over accounts. These are all of your invested assets that are considered to be tax-deferred.
- Non-Retirement Assets. This would be all of the investments that you have in NON-tax deferred accounts like a basic brokerage account or a Certificate of Deposit with a bank.
- Current Marginal Tax Rate. This is the rate of federal taxation that you currently pay to the government. There are currently 7 tax rates that the IRS will hit you with - 10%, 15%, 25%, 28%, 33%, 35% and 39.6%. If you're unsure, please refer to the IRS site.
- Retirement Tax Rate. After you retire and your income structure changes away from wages or salary to more passive income like dividends and interest your marginal tax rate will likely go down. We recommend using the next tax bracket down from where you currently are. If you are in the 28% tax bracket, you should use 25% for example.
If you're ready, click 'Get Started' below, if not bookmark us and come back later. In the meantime see what else FinPlan has to offer you by clicking 'Not Ready'