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Financial Health

for Healthcare Professionals

Millennials and Retirement: the To-Do List

Retirement saving is not on most millen- retirement savings account. This means Retirement Savings: How Much?
nials’ list of top priorities. That may be that you only pay taxes when you take the It depends on your goals, lifestyle, cost
why many experts expect that millennials money out at retirement. The advantage of living and various other factors.
will not be able to retire until well into here is that you do not need to pay taxes 15 percent: One rule of thumb is to
their 70s. on any of the dividends, compound inter- save 15 percent per year.
In fact, according to Gallup’s 2014 est payments or capital gains you earned 8 times: Another rule is to save rough-
Economy and Personal Finance poll, the over the years until you withdraw your ly 8 times the amount of your final salary.
top financial concerns of millennials are money. However, for both 401k’s and IRA’s For instance, if your ending salary is
student loan debts, lagging wages, housing any amount you withdraw before age 59 $75,000, you may want to save around
and living costs, bills and credit cards/debt 1/2 will typically subject you to income $600,000. PROVIDED BY HOWARD
and lack of employment. taxes and a 10 percent penalty. 70 percent: A third common rule is to WOLKOWITZ, A FINANCIAL
Despite your current expenses, it is not You may also have heard about Roth replace a minimum of 70 percent of your REPRESENTATIVE WITH
too early to consider retirement planning. IRAs. The difference between the two is pre-retirement income, which is the aver- COASTAL WEALTH A MEMBER
And there are some steps you can take to that traditional IRA contributions are state age income for roughly the last ten years OF THE MASSMUTUAL
start saving right away. and federal income tax deductible for leading up to retirement. Seventy percent
Budget: A budget that prioritizes savings every year you contribute, but you pay is an estimate, but the point is that retire- FINANCIAL GROUP, COUR-
can help you take a closer look at your income taxes when you withdraw at retire- ment can be expensive. So that number TESY OF MASSACHUSETTS
recurring and nonrecurring expenses each ment age. Roth IRAs are not tax- may be a good place to start in order to MUTUAL LIFE INSURANCE
month to set aside a reasonable amount. deductible, but like traditional IRAs their maintain your standard of living. COMPANY (MASSMUTUAL)
And the first step in prioritizing savings? growth is not taxed. Unlike traditional
Taking a look at retirement plans available IRAs, however, your withdrawals at retire- Retirement and Financial
to you. ment age are not taxed. Priorities For more information, please see
Invest: In addition to retirement plans, Retirement saving is difficult when so https://www.massmutual.com/individuals/
Retirement Plan Types you may want to invest for long-range many other financial issues might seem educational-articles/index.
401(k): Some retirement savings goals like buying a house or other major like they should have priority. Saving, let For more information, please contact
accounts offer good tax advantages and asset. Remember, different investment alone investing, may not seem feasible as Howard Wolkowitz at
investment opportunities. In fact, many vehicles come with different expenses and you try to make ends meet. HWolkowitz@mycoastalwealth.com
employers offer programs like 401(k)s that charges. That is why you may want to look But not saving early for retirement may or (954) 558-3673.
contribute to the plans on your behalf. at investments like index funds and mutu- put you at risk of having to retire later
This is a retirement plan that you can start al funds or even annuities with low than you want or under less-than-ideal © 2016 Massachusetts Mutual Life Insurance
investing into right away. expense ratios across a wide range of asset circumstances. Company, Springfield, MA 01111-0001
IRA: A traditional IRA is a tax-deferred classes for diversification. FY1096 CRN201809-204893

6 November 2018 southfloridahospitalnews.com South Florida Hospital News