Retirement Planning For Dummies

Description

Advice and guidance on planning for retirement Retirement Planning For Dummies is a one-stop resource to get up to speed on the critical steps needed to ensure you spend your golden years living in the lap of luxury―or at least in the comfort of your own home. When attempting to plan for retirement, web searching alone can cause you more headaches than answers, leaving many to feel overwhelmed and defeated. This book takes the guesswork out of the subject and guides readers while they plan the largest financial obligation of their life. • Take stock of your finances • Proactively plan for your financial future • Seek the help of professionals or go it alone • Use online tools to make retirement planning easier Whether you're just starting out with a 401(k) or you’re a seasoned vet with retirement in your near future, this book helps younger and older generations alike how to plan their retirement. Title Page Copyright Page Table of Contents Introduction About This Book Foolish Assumptions Icons Used in This Book Beyond the Book Where to Go from Here Part 1 Getting Started Chapter 1 Retirement Planning Is Up to You Blazing Your Own Retirement Plan Measuring Your Lifespan Social Security Administration’s Life Expectancy Calculator Bankrate’s Life Expectancy Calculator Living to 100 Life Expectancy Calculator Retirement Planning Beginnings: The Pension Changing Times: The 401(k) Behold the power of the 401(k) An opportunity to save Social Security: The De Facto Safety Net Chapter 2 Determining How Much You Spend Finding Out Where Your Money Goes Eyeing your expenses Tracking your money’s every move Spending guidelines Measuring Your Spending Using your credit card company or bank’s online resources Diving into the world of third-party apps and online tools Checking out other money-tracking options Doing something with all this data Putting Your Spending in Context Using government statistics as a guide Seeing how spending changes as you age Improving Your Numbers Figuring out if your latte is ruining your retirement Finding easy ways to stop wasting money Boosting your income with a side gig Chapter 3 Calculating How Much You Need to Retire Getting to Know the 4 Percent Rule How the 4 percent rule works The magical power of the 4 percent rule Shortcomings of the 4 percent rule Using Online Retirement Calculators Getting started Exploring retirement calculators from mutual fund companies Drilling in with detailed retirement calculators Avoid gambling with retirement: Monte Carlo analysis Understanding Why Starting Early Is Important Compounding: The most powerful force in the universe Inspiration to start retirement planning now The race to $1 million: Doable if you start soon Chapter 4 Choosing the Right Account Retirement Planning in a Nutshell Getting started What about pensions and Social Security? A Great Place to Start: 401(k)s Advantages of 401(k) plans Drawbacks of 401(k) plans The Roth: An interesting twist on retirement savings IRAs: A Cornerstone of Retirement Planning Advantages of IRA plans Drawbacks of IRA plans A few IRA odds and ends Self-Employed Plans The spectacular SEP-IRA The 401(k) for one: A one-participant 401(k) Keeping it SIMPLE What’s the Catch? Tax-deferred isn’t tax-free Beware the 10 percent early withdrawal penalty Don’t mortgage your future: Retirement plan loans Chapter 5 Gauging Your Appetite for Risk Getting a Handle on Your Risk Tolerance Determining your investor type Understanding risk tolerance Looking at risk tolerance differently Using risk-assessment tools The ABCs of Asset Classes Putting stocks in a box Adding bonds Including a few other asset classes Seeing how risk tolerance and returns work together Chapter 6 Opening Your Accounts Getting Your 401(k) Up and Running Understanding target-date funds Knowing the people involved in your 401(k) Getting familiar with your 401(k) plan Plugging into Your IRA Knowing what you’d like to own Choosing someone to handle your IRA Mutual fund companies Traditional and discount online brokerages Robo-advisors Connecting with a Financial Planner Finding a financial planner Deciding what is right for you Part 2 Using Online Resources Chapter 7 Managing and Optimizing Your 401(k) Getting Online Registering for 401(k) access Getting to know your 401(k) tools Checking your performance Checking Your Portfolio Allocation Understanding the key asset classes Looking at your current mix without using a calculator Finding your optimal asset class mix Changing your asset allocation Powering Your 401(k) with Contributions Inspecting your current contribution level Deciding how much to contribute Seeing the power of putting more away Discovering Other Nifty Aspects of Your 401(k) Plan Site Locating information on plan loans and withdrawals Digging into the statements Finding various plan documents Chapter 8 Taking Your IRA to the Next Level Getting Online with Your IRA Provider Opening your IRA account Logging in and looking around Understanding your portfolio holdings Checking Your Portfolio Asset Allocation Understanding correlation Viewing your asset allocation on your provider’s website Enhancing your asset allocation Understanding Your IRA Contributions Setting up IRA deposits Roll over Beethoven: IRA rollovers Funding an IRA with a Roth conversion Taking Money out of Your IRA Getting money out early: 72(t) distributions Taking your required minimum distribution Setting up a beneficiary A word about inherited IRAs Chapter 9 Optimizing Your Retirement with Third-Party Offerings Understanding Fees Improving success with lower fees Knowing the types of fees Uncovering the shocking truth about fees Examining Your Portfolio Using Morningstar Pulling up individual funds that you own Putting your entire portfolio to the test Putting Your 401(k) Under the BrightScope Microscope BrightScoping your 401(k) Learning more about your funds Getting to know your advisor Grading Your Retirement Plans in Other Ways X marks the spot for a better 401(k) Getting up close and personal with Personal Capital Chapter 10 Digging into Social Security Discovering All the Benefits of Social Security Disability coverage (SSDI): The forgotten bonus of Social Security Medicare for All Survivors benefits Retirement benefits Managing Social Security Information Online Examining what you’re paying into Social Security Signing up for and accessing Social Security information online Understanding your history of Social Security credits Planning for Social Security in Retirement Claiming your Social Security benefit Applying for benefits Part 3 Maximizing Your Retirement Knowledge Chapter 11 Balancing Retirement Savings with Other Needs Cleaning Up Your Personal Balance Sheet Building an emergency fund Cutting the debt anchor loose Opening a taxable brokerage account Saving for a Home Seeing how a retirement plan can help Knowing how much you can afford Budgeting for homeownership Saving for College Understanding why your help matters Choosing a college-savings account Choosing a 529 provider Figuring out how much you should save Chapter 12 Fine-Tuning Your Asset Allocation Exploring Stock Strategies Understanding small versus large companies Knowing where your money is: international, global, and emerging markets Trusting real estate investment trusts Diving for Income Getting to know bonds better Going to town with municipal bonds Using Morningstar to study bonds It’s Easy Being Green: The Rise of ESG Deciding whether to include ESG in your retirement plan Understanding ESG investments Buying into an ESG Chapter 13 Keeping Your Retirement on Track Tracking Your Portfolio’s Health Measuring returns and asset allocation Modifying your plan Tracking and Updating Your Goals Assessing your goals Seeing if your goals change your plans Tracking retirement progress and milestones Chapter 14 Gearing Up for Retirement Creating a Retirement Budget Test-driving your budget Keeping your stock exposure Waiting until 70 to collect Social Security Having a healthcare plan Knowing the bucket strategy Working longer Thinking about Annuities Understanding the types of annuities Finding an immediate annuity Running sample annuity numbers Unlocking a Goldmine: Reverse Mortgage Understanding reverse mortgages Understanding the drawbacks of reverse mortgages Using a reverse mortgage Chapter 15 Understanding Pensions Checking a Private Pension’s Funding Understanding the Problems with Public Pensions Understanding Pensions Inside-Out Choosing a lump sum versus ongoing payments Choosing single life versus survivor Managing Your Pension Using online tools Calculating the value of a lump sum payment Rolling over a pension Chapter 16 Getting Insurance Building a Health Insurance Plan Unlocking the health savings account Understanding Medicare supplemental plans Exploring the exchanges Considering long-term care insurance Defending Your Money with Insurance Checking property and casualty coverages Getting ready for a rainy day: Umbrella insurance Protecting your family with life insurance Part 4 The Part of Tens Chapter 17 Top Ten Retirement Mistakes Waiting to Save Ignoring Fees Not Securing Your Information Prioritizing College Savings Over Retirement Not Diversifying Your Portfolio Waiting for the “Right Time” to Invest Having Inadequate Insurance Taking Money from Your Accounts Early Not Checking Your Social Security Benefit Not Thinking about Income Chapter 18 Top Ten Retirement Questions How Much Money Do I Need? Is Medicare Enough? What Will I Do with My Free Time? Will I Run Out of Money? Should I Have a Roth or Traditional IRA? How Good Is My 401(k)? What’s an RMD? Can Retirement Rules Change? What Can I Do If I’m Near Retirement Age and Don’t Have a Plan? Do I Need a Financial Advisor? Index EULA