AL: I understand your quandary. However, I wouldn't let the secondary POA issue hold up the estate planning process. Get something in place and talk with your wife about suitable alternative.
@Fred -Yes. SS benefits increase by roughly 8% a year if you wait. You can go to ssa.gov/estimator to get your personal benefit amount at various ages.
Kevin. it's great that your company socks away money for you. Could you do both? The compounding effect oon your retiremet savings would be enonormous for someone in their twenties. how about saving 3% or 4% for reirement and put the rest away for a down paymennt?
Hi Mary, I would stay away from annuities. Especially at this point. One they are higher in internal fees and the other is there may be a 5-7 year surrender penalty to pull your money out.
Hi Charlotte, I cannot comment on specific funds and whether they'd be appropriate for you in a forum like this simply because we're dealing with incomplete information and in the office we have all information available on the client, age, gender, income, goals, other resources, timeline, risk tolerance, risk required, risk capacity, etc. Please consider seeking a planner at www.napfa.org to get a professional recommendation specifically for your situation. Planners like Frank (on here right now) work hourly so this should not be prohibitive for you to seek expertise.
Ralf: The asset allocation design is dependent on many variables. Do you feel that the returns and risk/volatility are a good match for your risk tolerance and financial situation? Hard to comment with a limited amount of information. Thanks
Hello Apple Z, could you be more specific? What kind of trust? I don't know of any maintenance fees other than corporate trustees.
AppleZ: If it is a Irrevocable Trust, it is common to pay some sort of annual fee for record keeping, etc.
Kay, you are on the right track. What amounts you put in what accounts will depend on a few factors. It is really important to have the taxable account and savings account with 6 months of net salary in liquid investments. The biggest advantage to good counsel is that you will avoid those life altering financial mistakes. Some are: never lend money to a friend or relative; never take investment advice from the same (we have heard so many "sure thing opportunity" in our practice that never turn out); make sure that you cover your risks with insurance; buy term life once you have dependents; don't use insurance as an investment, too costly; make sure that you invest with a custodian such as schwab, ameritrade, fidelity, etc. Good luck, you are doing a terrific job.
Hi Lee. You say you are risk averse but you are putting all of your retirement money into stocks. i agree with your friends who are telling you to diversify. Slow and steady wins the race. Bonds provide income and they help stabilize your portfolio. You say you won't panic and sell but what happens when you reach retirement date and your stocks have declined by 40% and you need cash? it's happened before. If you need stock growth to meet your goals, you need to rethink your retirement date, spending needs etc. I sugest you go to NAPFA.org and find a fee only advisor who can help you.
@Sammy - I am old school, and I believe putting 20% down makes sense. This will keep your monthly payment lower, and you also avoid the funding fee. There is a bit of an argument for taking a bigger loan because rates are so low, but there are pitfalls in doing so. BTW, because rates are so low, did you look into a shorter term, like a 15-year or a 20-year loan? You may be surprised at the similarity, in some cases of the monthly payments.
AH, yes Apple Z, you are correct. Letters to beneficiaries do need to go out annually. I would think that an small hourly fees would be sufficient. I would call a few lawyers to see. I definitely would not do a percent of the assets. Sorry that is more of a legal question. Hope that helps.
Hi Rosana, I would suggest continuing to save in the 401(k) account past 59.5 unless you do not like the investment choices in your plan and would like to save elsewhere (there are still some awful plans out there, hopefully you have a good one). Guaranteed interest rates tend to be low to protect the institution making the guarantee. Do you qualify for the Roth plan at your company? If so, it would be a good choice for diversifying your overall accounts. It sounds like you would benefit from another set of eyes reviewing your investments choices. www.napfa.org
Terry, I'm glad you brought that up...
@Maurice - For the most part. You can, however, invest in investment grade bonds through a mutual fund or an ETF. This gets you the asset class of Investment Grade Bonds, but reduces the potential credit exposure of buying one bond. You can get realy inexpensive bond fund through Vanguard.
Hi Moeman. i'm not crazy about target funds. if Spartan's are available, you might want to use them. Spartan 500 should be your core supplemented by the extended market index. Your asset allocation seems reasonable but I couldn't know for sure without knowing more about you.
DCH -- We have you coming up shortly. Thank you for your patience!
Ed, the reason many retirees roll over their work plans is that they will have more choices to invest in. If you are happy with the limited choices of the TSP, there is really no reason to change. There would probably be higher fees in the retail brokerage business, and if you go it alone, well you would have to make lots of choices of what to invest in. Even with discount brokers, there are fees for many investments.
FL Massage: Based on your information, I think that you should work with an advisor to review your situation and put a savings plan in place. I assume that you will receive SS benefits. If your house is paid off, that may be a source of income in retirement. Go to the NAPFA website to find a local advisor. There is lots of help out there. I wouldn't recommend liquidating any investments until your review your financial situation with an advisor. Thanks
@Maurice - Also, buying individual bond can potentially be very expensive. Bond "spreads' are very opaque so tread carefully if you go this route.
you are welcome Ed, and good luck.
Hi DCH. Fifteen years is a long way off but you could benefit from a session with a financial planner. You can find one at NAPFA.org. It may sound like I'm evading your question but there are so many issues here that i can't name them all. one big one that jumps out at mme id health insurance. Unless someone is diabled, they can't get Medicare until they are 65. You will need to buy private insurance and it may be very expensive. The other obvious consideration is do you have enogh money and if not, what do you need to save to get there? This is where a planner can help you.