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Janice France-Pettit: Facts about retirement planning

Union Bank of Santa Clarita

Posted: August 13, 2010 4:57 p.m.
Updated: August 14, 2010 4:55 a.m.

Saving for retirement can seem like an enormous task, but with the right planning and help from your financial team it can become easier to accomplish.

Here are some tips to consider when planning for your retirement:

Establish a budget
By creating a budget and closely monitoring your funds now, you may find it easier to manage your money once you retire and have a fixed income. A budget can also help you manage your monthly expenses, keep track of where your money is going and show you how much money you can afford to invest each month.

Assess projected retirement income
To calculate how much you will need to save for retirement, you should try to estimate all your future potential sources of retirement income, such as Social Security benefits, pensions and workplace retirement-plan proceeds.

If you are considering taking a part-time job after you retire, you should include that income in your calculations as well.

Plan on changing your plan
Once you establish a budget, you might find that life’s circumstances may alter your retirement investment plan. Unplanned events can take a toll on your retirement savings, and you may need to update your retirement plan in order to stay on track. Talking to your financial advisor or using retirement calculators may help protect you from losing your retirement investments when you encounter changed circumstances.

Consider your retirement savings ‘off-limits’
You should think of your retirement savings as “off-limits” until you reach your retirement age. Try not to use it for ordinary expenses. Also, you should try to maintain an emergency fund so you will be prepared for any unforeseen circumstances such as job loss or health issues that may cause you to use your retirement account.

Take your savings with you
Throughout your life, you may change jobs several times. When you move to a new employer, you should move your retirement savings with you. There are several choices when it comes to how you can transfer your former employer’s savings plan to your new employer or to an existing retirement account. You may wish to talk to a financial advisor about which method is right for you.

Supervise your retirement portfolio
Monitoring your retirement portfolio is a smart idea, especially as you get closer to retirement age. You may discover that your investment plan will need adjusting in order for you to retire at the age you desire. Keeping in close contact with your financial advisor will help you make adjustments or changes on an annual basis or more often if needed.

Stay informed about rule changes
You should keep up to date on incentives so you can take advantage of any opportunities that arise that may help increase your retirement nest egg. For example: For the 2010 tax year, the IRS is allowing people 50 years and older to contribute an extra $1,000 to their individual retirement accounts (IRAs). You should talk with your financial or tax advisor to help keep you informed about government incentives.

The earlier you begin planning for your retirement, the more prepared you may be for your future. Your financial advisor or tax advisor can help you begin the process of setting up a retirement plan that is right for you and your loved ones.

Consult an experienced financial advisor to determine if using a credit line may be the best option for you.
Janice France-Pettit is a senior vice president and regional manager for Union Bank, overseeing the Simi Valley, San Fernando Valley and Antelope Valley regions. Her column reflects her own opinion and not necessarily that of The Signal. The foregoing article is intended to provide general information about retirement planning for businesses and is not considered financial or tax advice from Union Bank. Please consult your financial or tax advisor.


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