Do You Need An Independent Financial Advisor For Your Mutual Funds?

July 12, 2012 · Posted in Investments 

A 401k plan is the most common retirement plan that people take out. Currently you can invest up to 15% of your salary into the fund. The money you invest is pre-tax which means it lowers the amount of tax you are paying out of your salary.

Unless you have a dire emergency you are strongly advised to leave the funds to mature until you retire, otherwise you may be forced to pay a stiff penalty for the privilege of accessing your money early.

An IRA or Individual Retirement Account is quite a different beast. You’ll discover that there are much stricter terms and conditions on IRAs compared to a 401(k). To start with if your employer offers a 401(k) you would have be earning very little to qualify for the ax deductions allowed.

All rewards that are worth it come with an element of risk. If you only decide to invest a tiny amount into your retirement fund, then you’ll be missing out on the long term benefits. If you have some extra cash now, try to see that by saving this extra amount now, you’ll be reaping the rewards several times over when you do actually retire. This doesn’t mean being reckless but in order to receive a bigger payout you’ll need to be willing to take some calculated risks now.

Another point to be wary about is if you company offers incentives for you to invest in their stock. This is a judgment call and you are the best person to determine whether you think the firm will be profitable and give you a yield on your shares in the future. The worst thing you can do is buy your own company shares out a of a sense of loyalty of because you are given a big discount.

It is really never too early to formulate a detailed retirement plan, however before you take a dive; you should make sure that the water is clear. Investing for retirement process requires a detailed planning to get the results you desire. I am sure that with few tips I provide you here, you can just start making most out of your retirement planning.

You can max out your 401(k) in order to decrease your income tax liabilities and save money in the process. The maximum amount of money which you can contribute to 401(k) is determined by the IRS annually. For 2012, maximum limit is $16,500. When you make maximum contributions to 401(k), you reduce your federal income tax and other state taxes.

A Roth IRA is one of the best ways to save for retirement outside of your 401K. It is funded with after tax dollars making it so that you will not have to pay taxes when it is used. You can also use the money you deposited without penalty before age 59. These options make this a great way to save.

Many people will be working longer than individuals in the past, but we will also be living longer. Find something you enjoy doing and consider making a part time business out of it and this will give you further options during your golden years. As long as you plan for the future, you will be headed in the right direction.

For self-employed individuals, you can opt for a Keogh plan. This is basically the same as a IRA but tailored for the individual who pays his own taxes. Small business owners may be interested in a SEP ( Simplified Employee Pension Plan). These are slightly easier to administer but are essentially the same as Keogh plan.

Only at: http://financial–advisor.com/IndependentFinancialAdvisors.html will you be able to find the information you seek.

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