Steve Kerby
Oregon Financial Group
On Time, Tax Benefits, On Target, UnTouchable
"Making contributions to a traditional or Roth IRA dramatically increases your ability to build a bigger nest egg, especially if your employer matches contributions. You want to take advantage of this "free money." Steve Kerby
Are you participating in your employer's 401k or IRA plan? If not, you may be missing out on the opportunity to avoid running out of money when you no longer work. This is especially true now that the "Setting Every Community Up for Retirement Enhancement (SECURE) Act became law at the beginning of 2020.
Bureau of Labor Statistics research indicates that only about 56% of eligible workers participate in a retirement plan offered by their employer in any given year. That's troubling, especially when you consider that people tend to vastly underestimate how much money they will need once they no longer bring in a paycheck.
4 Reasons you need to enroll in your employer's plan right now.
- Tax benefits: Both traditional IRAs and 401(k) plans offer tax-deferred retirement savings. Talk to your tax expert about your situation. You might qualify to get a deduction for your contributions to a 401(k) or IRA. After you retire, distributions to these accounts are taxed as income for the year they are taken. Contributions are subject to IRS limits. Contributions to these kinds of accounts are made with after-tax dollars, with distributions after age 59½ being tax-free. Roth IRA contributions come from after-tax money, and potential earnings grow tax-free. With a Roth, you can also withdraw contributions any time you want, without additional taxes or penalties.
- Your plan is unTouchable: Yes, there are exceptions. But in general, employer plans are an "out-of-sight, out-of-mind" proposition. Because money comes directly out of your paycheck and goes into your retirement account, you won't have to think about saving.
- Your plan is "on Time." You can't keep retirement funds in an account forever. If you attain age 70 on July 1, 2019, or later, you will have to take withdrawals starting at age 72, whether you need the cash or not. But, waiting as long as possible to access plan money can add up to THOUSANDS of extra dollars in retirement.
- Employer plans can help you get on Target. Most Americans seriously underestimate the amount of money they will need when they retire. Adding a powerful income stream generated by an employer plan will go a long way toward helping you avoid running out of money when you retire.
Steve Kerby
Oregon Financial Group
5555 SW 196th Ave.
Aloha, Oregon 97078
kerbyofg@aol.com
(503) 936-3535
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