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Money Management: Retirement

Investing

One of the best ways to save for your retirement is to use a tax-advantaged (e.g., tax exempt or tax deferred, etc.) account such as a 401(k) or 403(b) offered through your employer. While work-sponsored retirement accounts aren’t available to everyone, this doesn’t mean you can’t gain access to a 401(k). Most people can open an individual retirement account (IRA) and make the most of useful tax breaks. advantage of some useful tax breaks.

Two types of IRAs, traditional and ROTH, are similar but have different tax structures with different benefits.What you need to know about IRAs 

Traditional IRA

With a traditional IRA you’re deferring the taxes you owe on income until retirement, when you’re likely to be in a lower tax bracket.

Roth IRA

With a Roth IRA, a person will pay taxes on income in a given year, and not have to worry about those taxes in retirement.  You also earn tax-free income in the form of investment gains on your Roth IRA contributions.

For a detailed review of the similarities and differences between the various retirement accounts it’s best to consult with a financial advisor. In the meantime, the Simple Dollar has an easy to read resource, “Which Retirement Plan is Right for Me?” 

Thinking of Retiring?  Planning is Key

These slides from the "Social Security - Planning Your Retirement" presentation provides a wealth of information, courtesy of the Social Security Administration.

Government Information

SSA logo

With retirement, disability, and survivors benefits, Social Security is one of the most successful anti-poverty programs in U.S. history.

NYSLRS logo

The New York State Employees’ Retirement System (NYSERS) provides benefits for state civil service officers, police, firefighters and employees.

NYC Department for the Aging logo

The mission of the NYC Department for the Aging (DFTA) is "to work for the empowerment, independence, dignity and quality of life of New York City's diverse older adults and for the support of their families through advocacy, education and the coordination and delivery of services."

Preparing for Retirement

There's much to consider when planning your retirement: Have you saved enough? When can you stop working? How long will your money last? The video below will address some of these questions and explain how the AARP Retirement Calculator can help you plan your financial future.

Is age just a number?

When it comes to retirement, your age (and financial planning) can determine how well, or whether you’re able to retire when you want!  (Please note that the following is prepared for general information only.)

 

The most common way to invest money for retirement is to place funds in a 401k Plan, or an Individual Retirement Account (IRA). 

 

In your 20s you may think you’re too young to think about retiring. (Maybe you have so much student loan debt that you can't think about saving money for anything, let alone retirement!) Still, you may want to consider contributing to your company’s 401(k), 403(b) or 457 planFINRA, the Financial Industry Regulatory Authority, provides an excellent retirement calculator (see the video in the left margin) to help you decide how much to set aside based on age and type of investment account.
A 30-year-old who saves 6 percent of a $50,000 salary, or $3,000 a year, can have nearly $840,000 put away by the time he/she has to begin withdrawing funds from a 401(k) at age 70½!
By age 50 you may think it's too late to plan for retirement. Actually, you may have an advantage: the IRS lets you to save more money in your retirement plans. Since your 50s can be your strongest earning years, increased contributions can help make up for the years you may have lost.
At 62 you could be eligible for full pension benefits from your employer, depending on their plan, and you might also begin to receive reduced Social Security benefits. The Social Security Administration (SSA) has helpful information on when to start receiving retirement benefits.
Once you’re 65, you can receive full pension benefits from most employers, and you normally qualify for Medicare benefits. Please note that if you were born after 1937, your eligibility depends on the year of your birth. The age widows or widowers become eligible to claim full survivor benefits also depends on year of birth.
If you haven't already, you should start collecting your Social Security benefits by age 70.  Even if you delay this, there's no increased benefit.
According to the IRS, you must take your first Required Minimum Distribution or RMD, by April 1st of the year following the calendar year you reach age 70 ½.

Even after you’ve retired, you may want to factor in other considerations while planning for the future, for example, in relation to the financial security of loved ones. Life insurance may be one such factor. The National Association of Insurance Commissioners has designed questions for you to answer to help you decide on the best options. 

Consumer Review Sites

AARP logo

AARP Retirement Essentials

AARP is a nonprofit, nonpartisan, social welfare organization with a membership of nearly 38 million that helps people turn their goals and dreams into real possibilities, strengthens communities and fights for the issues that matter most to families — such as health care, employment and income security, and protection from financial abuse.

The contents of all material available on www.aarp.org are copyrighted by AARP. 

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360 Degrees of Financial Literacy

360 Degrees of Financial Literacy is a free resource of the American Institute of CPAs, and offers helpful financial information to retirees.

There are several books and eBooks in our catalog that can help you with retirement planning. You can always search the catalog using keywords such as "retirement", or "retirement planning", but there are also a number of useful subject headings that can be used to  find books and eBooks on these topics. You can copy any of the phrases below, paste them into the catalog search bar, and then change the drop down option to "Subject" to find targeted results.

Retirement - Planning

Retirement - United States - Planning

Retirement Income - United States - Planning

Invest for Retirement

Baby Boom Generation - Retirement

Older People - Finance, Personal

Baby Boom Generation - Finance, Personal

Finance, Personal - United States

Books and eBooks

Retirement Reinvention

Retirement has changed, and America's most trusted career counselor is here to guide you through your own Retirement Reinvention. "Robin Ryan is the most knowledgeable career expert in the nation today."-PBS. For twenty years, Robin Ryan has been helping clients get the most out of their careers and their lives. Now, in Retirement Reinvention, she shatters the myths of retirement. The old model of retirement is changing. The majority of retirees today are seeking fun and meaningful ways to spend their time. Full of practical advice, this thought-provoking guide offers readers a path for reinventing their own retirements.

Retire on Real Estate

Think beyond the nest egg . . . Do you know how you'll fund your retirement? With pensions slashed, savings slim, and Social Security insufficient and unpredictable, most people won't have nearly enough money to last them. But a sustainable solution lies in plain sight: rental property. Retire on Real Estate helps anyone, of any age, take advantage of this often overlooked income generator. Written by a seasoned real estate investor and landlord, the book exposes the cracks in most retirement portfolios, opens your eyes to the benefits of rental income, and lays out a complete plan of action.

Retirement Fail

There are nine key reasons people fail at retirement--and they're not what you think. Are you working to avoid these major retirement fails? Every day, people just like you, people who have worked hard and saved carefully for retirement, make decisions that will eventually crack their nest egg. Just because you added to your 401(k) or IRA plan every year, invested wisely, and amassed significant savings, you are not necessarily home free. Ready or not, your decisions all along the retirement path can positively or negatively affect your financial future. In Retirement Fail, top financial adviser Greg Sullivan shares the insights he has gained over his thirty-five-year career in wealth management to help you identify potential pitfalls and learn how to safeguard your hard-earned retirement assets.

Ready to Pull the Retirement Trigger?

Ready To Pull The Retirement Trigger? Many want to retire early...slow down a bit...enjoy their life, their spouse and grandkids. But what if there is a major health issue? Or what if they run out of money? There are many issues facing people as they consider retirement. Where can they turn for answers they can trust? There are no do-overs in retirement. People need a path. They need a strategy. They need a guide. Ready To Pull the Retirement Trigger will arm anyone entering the retirement stage with the essential knowledge to create a strategic plan so they can retire with confidence.

AARP Checklist for Retirement

How to Get the Most Out of Your Retirement. Whether you're planning for or already living in retirement, there's a lot that goes into making the most of every day. From crafting a budget and managing your money to last a lifetime to simplifying your life so you can really focus on what you want to do next, Get the Most Out of Your Retirement walks you through the process.