401k
401k Information

Best Retirement Plans

The traditional thought about the pension plans is that these are the ‘defined-benefit’ plans. Any variants to th 00004000 ese plans are not viewed as the real-pension plans. There are many new retirement plans but the traditional ones have still not lost their appeal. Many would still bet on these as the best pension plan.

The benefit that is given under the traditional pension plans is predefined and guaranteed to be given. It is calculated on the basis of a fixed formula and is not dependent on the return on investments, you will continue to receive the amounts throughout your and, more often, your spouse’s lifetime as well. One can invariably ask which types of organizations prefer having these plans to the others. Or, why do organizations prefer these traditional pension plans over the others? The answer is all those companies who want their employees to stay with them for a long time prefer opting for these plans. This is because these plans are generally not portable and therefore, are more suited for organizations having a less mobile workforce. These are good for the organizations image as well since the employees believe that the organization is serious about providing them a lifetime income.

These pension plans are brought out both by the private sector and the public sector. The private sector plans generally do no have contributions from the employee but the public sector employees do contribute to the extent of 5% of their salary. Also, the public sector traditional best pension plan may replace the social security system. Thus, the employees will get higher benefits under the pension to cover for the social security payments. Those public sector employees who also pay social security taxes, their pension payable is arrived at after multiplying their number of years in service with 1.8% to get the amount in terms of percentage of salary.

Traditional plan is considered best pension plan for another reason that these are protected, with certain limitations, by the Pension Benefit guarantee Corporation ( PBGC). If these plans have provisions for early retirement of the employees, then the payments are reduced since these would now be paid for a longer period of time. So, it is not easy to judge which the best pension plan is. All depends on the requirements of the individuals and organizations.

Frequently Asked Questions

  1. QUESTION:
    What are the best retirement plans for a yong lawyer to consider?
    i am a law school student and i want to know what would be the best way to plan out my retirement. Such as what i would be doing at what age. i am 26 now.

    • ANSWER:
      Sorry don’t have any retirement plan advice, but here’s something on planning for those post retirement needs:

      A stingy old lawyer who had been diagnosed with a terminal illness was determined to prove wrong the saying, “You can’t take it with you.”

      After much thought and consideration, the old ambulance-chaser finally figured out how to take at least some of his money with him when he died. He instructed his wife to go to the bank and withdraw enough money to fill two pillow cases. He then directed her to take the bags of money to the attic and leave them directly above his bed. His plan: When he passed away, he would reach out and grab the bags on his way to heaven.

      Several weeks after the funeral, the deceased lawyer’s wife, up in the attic cleaning, came upon the two forgotten pillow cases stuffed with cash.

      “Oh, that darned old fool,” she exclaimed. “I knew he should have had me put the money in the basement.”

      http://www.ahajokes.com/law022.html

  2. QUESTION:
    what are all the best retirement plans available.I am aged 52 and how much I plan for retirement plan.?
    Shall somebody give me the comparison of the plans available to choose the best and also advice on my earning of RS.75000 per month.

    • ANSWER:
      My advise to you is two fold.
      First thing you need to do is find a competent financial adviser. The important thing to look for is to find one with the heart of a teacher. They need to be able to sit down with you and explain what options you have and how they work. They will find out what your risk tolerance is and what kind of lifestyle you want to have when you retire. The key here is to never invest in something unless you know exactly how it works and what the risks are. If you have a job that offers a 401K have them explain that to you also. You can find someone in your area by going to Daveramsey.com and looking up his Endorsed Local Providers for investing (ELP) for your area. they will probably recommend you do a Roth IRA in a high performing mutual fund since it will grow tax free. The other part of the equation is to get a plan and get out of debt because being in debt will rob you of your ability to build wealth. Don’t worry about being 52 years old there is still plenty of time left.

  3. QUESTION:
    I am married to an older man and wondering about the best retirement plans for both of us?
    Each of us has a 401(k) through our employer, but I am currently unemployed and going to school. I want to continue to put money back in my IRA at the back but he says thats no the best option for us right now because he is close to retirement. He says I will get his pension and anything else of his but I dont want to count on just that I want to have my own funds for me when I am ready to retire to go along with what I get from him. Any suggestions on what to do?

    • ANSWER:
      some info is here..

      http://www.daveramsey.com/etc/cms/saving_for_livelihood_6738.htmlc

  4. QUESTION:
    What is the best retirement savings plan for a small business owner?
    I’m a small business owner (4 full time employees) who does not offer any retirement plan or have one for myself. My employees are commission based only. What would be the best retirement plan for me and for all of us, individually? Thanks!

    • ANSWER:
      Check with your accountant.

  5. QUESTION:
    which is the best retirement plan in India?
    Present age is 45 and my retirement age is 60. Hence if I invest Rs 50,000/- per year for the next 15 years, which retirement plan is best and secure.

    • ANSWER:
      Checkout this link below:

      http://www.licindia.in/pension_plans.htm

      Thank you very much!

  6. QUESTION:
    What is the best retirement plan for an unmarried stay at home mother?
    I am a 28 year old stay at home mother, who is not married. I am concerned about what this is doing to my retirement savings. I want to know what my options are to be prepared for retirement.
    I forgot to mention I do not receive any assistance (e.g. welfare). I do live with my boyfriend, who is my daughter’s father.

    • ANSWER:
      Since you have no earned income you can’t get a plan like a IRA so you will need to invest in taxable accounts. Since you don’t have earned income you are probably not even paying taxes unless you are living on investments. If you are on welfare you might not be allowed to have assets so would need to wait until you got off welfare to start saving.

  7. QUESTION:
    Im beginig mu savings retiremtnt planning What types of retirement plans might be best? please explain the p?
    Please explain the plan and why you think its best.

    • ANSWER:
      The best option is the employer sponsored plan – these are the 401k, 403b, SIMPLE IRAs, etc. You contribute out of your paycheck in pre-tax dollars, which reduces your tax bite every paycheck and goes directly into a retirement fund. Your employer may match your contributions, so for every dollar you put in, they will give you a percentage “match” and that’s free money.

      Next, Roth IRA (if you qualify) this allows you to save money post-tax for retirement (and soemtimes you can withdraw early for specific reasons, like education, hardship, buying your first home). Your savings grow tax free and when you withdraw, the distributions are tax free (in most cases) after 59 1/2.

      Next Traditional IRA, similar to Roth IRA, but your distributions are taxed at your then tax rate rather than your now tax rate. Most people are in a lower tax bracket in retirement, so you allow your savings to grow tax free and distributions are taxable at your tax rate when you withdraw.

      IRA contribution limits for 2007 are ,000 if you’re under 50 years old and 00 if you’re 50 or older. Then, taxable savings.

      As an afterthought, you may consider annuities, insurance and long term care, but these are usually not recommended unless you have maxed out your other tax advantaged retirement accounts or have very specific concerns.

  8. QUESTION:
    What is the best retirement plan for self employed worker?
    I am 32 and working as a real estate agent. I don’t have a retirement plan yet, people tell me to open a RothIRA or a simple 401k…i don’t know much about these things, any advice is appreciated.

    • ANSWER:
      Let me start by saying, what you need to start first is a ‘Traditional IRA. What is that? You take the money to a Savings institution, and Open an IRA acct.. You can put up to 00 dollars, in it each year. Preferably all at once on Jan 1 You shop all the banks for the best interest rate, and it is locked up in a time certificate for 18mon or 3yrs..And you do an annual contribution every year thereafter.. Now the good part,, you write off the 00 off you income tax, which will net you a refund from five to six hundred dollars, every year..Depending what your tax bracket is..The00 keeps earning interest and you got 600 of it back..It grows tax free till you take it, in retirement.. Then you can take the 0 refund and invest in stocks ,bonds ,whatever else you wish to try for additional retirement investments. A 401k is really only good if you have an employer who matches a percent of your contributions.. Your self-employed so its all your money.. You can also have a roth I RA which is an investment vehicle which uses the markets ,mutual funds and bond funds for growth. Do yourself a favor and stop in one day at your favorite bank , and sit down with a financial advisor and planner, ask them about retirement vehicles, but just listen.. Then check at several more.. After about three, you’ll have all you need to know to make a intelligent deceision.. Being a real estate agent, you know mortgage loan vehicles are different, and so is retirement investments.. Hope this helps,, I myself practiced this very method ,and retired financially secure.. GOOD INVESTING!! SOLOMON

  9. QUESTION:
    For a military member, what is the best retirement plan?
    I am wanting to start a retirement plan, and I am 22 right now. Any links, or info on retirement for military members?

    • ANSWER:
      The TSP is your best bet – has very low fees and decent rates of return. Start putting 10% in and increase it every-time you get promoted or a raise. You’ll learn to live on less than you make and have a tidy sum of money when you do retire.

  10. QUESTION:
    What is the best retirement plan for a self employed (not incorporated) person with no employees?
    And by “best” I mean, which plan will offer me the best tax break now? The web sites are confusing, can I deduct 100% of my contributions to a self employed 401k?

    • ANSWER:
      Check with a local financial advisor. Most have free consultations or open houses. You should always incorporate your business because it limits your personal liability, provides tax breaks, and enables you to set up different types of retirement plans. 401Ks are offered by employers to employees. Your best bet would most likely be a traditional or Roth IRA. Again, check with your local advisor.

  11. QUESTION:
    The best retirement investment plans: ING, T. ROWE PRICE, FIDELITY, TIAA-CREF, Lincoln Financial and AIG?
    I changed jobs and at my new job I can set up a Tax Sheltered Annuities (403(b) plans for retirement. The plans are offered by the following six companies. Any suggestions to which company does the best. ING, T. ROWE PRICE, FIDELITY INVESTMENTS, TIAA-CREF, Lincoln Financial Group, AIG Retirement.
    FYI- My age is 50 and I have had 401K’s in the past and I consider myself pretty good at picking investments.

    • ANSWER:
      If it was me, I would pick either TR Price or Fidelity. I have also heard good things about TIAA-CREF. My 401k is with TRowe Price & I am very happy with them.

  12. QUESTION:
    What is the best company out there for retirement plans?
    What company do you suggest and what is your opinon about it?

    • ANSWER:
      Any reputable firm will do, although I prefer Fidelity myself. They have many options for investments, have some of the lowest fees, and are available for coaching and answering questions. They also have updates to MSMoney & Quicken free of charge so keeping track of your investments is easy.

  13. QUESTION:
    Best retirement plan for 30 year old?
    I’m almost 30 and I have not yet started planning financially for retirement. In the next month, I’ll be eligible through work to start a retirement plan, but I have NO idea what I’m doing or the difference between the options. I make around 80K, have a 10k/yr child support obligation. Any suggestions?

    • ANSWER:
      Here is a business week article that may help.

      http://www.businessweek.com/1999/99_29/b3638002.htm

      Just remember you have time but start investing now!
      IRAs are a great idea for your child… they have education IRAs so you can plan for college now!

      Cyn http://TheMaverickPlan.com

  14. QUESTION:
    What is the best retirement plan other than a 401K that is not through your employer?

    • ANSWER:
      The 401k at your employer should not be overlooked, espicially if you employer matches some of you contributions. Put in enough to get the full employer match.

      The Roth IRA is probably better than the regular IRA. Although you fund the Roth IRA with after-tax earnings, the Roth IRA has the advantage of not having any taxes due when you withdraw the money.

      Where you hold your IRA is very important. I think the most convenient is through a brokerage account like Fidelity or Schwab. Fidelity offers many Fidelity and non-Fidelity no-load mutual funds. All of the Fidelity and many of the non-Fidelity no-load mutual funds are “No Transaction Fee Funds”. You can also open a Roth IRA with any mutual fund company (Vanguard and T Rowe Price, for example).

  15. QUESTION:
    who offers better retirement plans, if not best…?
    who is offering better retirement plans, if not best ?
    LIC, HDFC Standard… etc. ? who has better option for ” retirement plans ” ? and why ? am 27 yrs old :) .

    • ANSWER:
      Your “asset allocation” is more important than which plans are offered. Learn it, understand it & you’ll beat most of your peers over the long term.

      Which plans are best (assuming you have the right asset allocation)?
      Plans with low fees are generally “best”. Stay away from plans run by Insurance Companies & Banks. They are usually the most expensive & have the most mediocre product.

  16. QUESTION:
    What is the best retirement plan for a small business owner?

    • ANSWER:

  17. QUESTION:
    what is the best retirement plan for 48 yrs old ?
    Hi i want to start retirement plan but i don’t know which one to choose. I am 48 years old and self employed. I don’t have much saving and i would like to avoid taking too much risk.
    thank you

    • ANSWER:
      So you’re pushing 50, and want to invest without too much risk?? Then you should put 5k into an IRA, for both you and another 5k for your spouse. In additon to this, you should save another 10k into a savings or brokerage account. Saving 20k a year MIGHT give you a respectable retirement nest egg. Can you do this?

      Generally people begin saving for retirement in their 30′s (if not before). Waiting till you are near 50, makes saving for retirement very, very difficult. Especially if you are not able to put these large monies away.

  18. QUESTION:
    What is the best web site information on plans for retirement?
    Mostly plans for what to do after retirement, including financial, travel, recreation, social and other life style plans.

    • ANSWER:
      try this one, I also like the tune, is chatching

  19. QUESTION:
    What is the best retirement plan for a 48 year old that has to start all over?

    • ANSWER:
      If I were you, I would save as much as I can, e.g. ,000 every month, and invest it steadily over 20 years. At the end of 20 years, you should have enough to retire.

  20. QUESTION:
    What is the best retirement plan to invest on?

    • ANSWER:
      Between a regular IRA and a Ross IRA, I think the Ross IRA is a better vehicle for saving for retirement. The reason being that you pay taxes on the money as you put it into the plan and never pay a red cent more (assuming congress does not change the law, which they have been known to do). So all the interest and capital gains are tax free.

      A regular IRA on the other hand is tax deferred until you withdraw the contributions and they are taxed at the full rate. Let us assume that you invested in a regular IRA and 40 years from now retire with an IRA containing ,000,000. That sounds like a lot but if you make sound investments and contributed the maximum each year it is very possible. You will probably have to withdraw ,000,000 a year to meet the minimum withdrawal rate. The tax rate in the future may be much greater than it presently is because of all the deficit spending and unfunded liabilities of today. It may be 60%. So you will wind up with only 0,000 a year after taxes with a regular IRA. With the Ross IRA will you retain most of your ,000,000. 60% more.

  21. QUESTION:
    What retirement plan is best?
    What would be the best retirement plan to look into for me? I have been doing some research, but there seems to be quite a few different plans such as “Roth IRA”, “Traditional IRA” etc. I’m 22, go to college full time, and work semi full-time, but I’m looking to start investing in some sort of plan with say /week until I get a career job where I can invest a lot more. I would just like to start now rather than later on down the road, so I can get more out of my money.

    • ANSWER:
      At your age the ROTH will be to your advantage.
      You can google “traditional IRA vs. ROTH ira calculator”
      Moneychimp.com has the best.
      But the result will the the ROTH.

      Note: FIRST you must have at least 6 months worth of emergency living expenese put away in a savings or a CD. No one, should live without this safety cusion. Also, most discount brokers will require ,000 initial investment (the best ones).

      Work in building up a savings account first.
      If you tie up your money in a ROTH there is a 10% penalty if you ever need to take it out…

  22. QUESTION:
    Suggest a reasonably best retirement plan?
    Hi friends,
    I wish to know which is the best retirement plan available in India, taking into considering the following aspects :-
    a) A person having put 20 years service in private organisation
    b) About fifteen years left over for retirement.
    c) With no social security of any kind available in India
    d) Assuming morderate inflationary trend of 5% to 7% in the next decade.
    e) With Real estate / stock markets not being stable at times

    • ANSWER:
      Well invest regularly in some MF through SIP. With a nominal investment per month and the returns of 15 to 20% per annum one can easily have a good amount ! I do not like insurence schemes as they are not very good with returns.
      Example
      5000 rs per month for 20 years , 20% return ( by the way some returns are 50%)
      12385970 Rs i.e One crore 24 lakh

  23. QUESTION:
    Which is the best retirement plan in Maharashtra (India) to invest?

    • ANSWER:
      do it in five parts

      FD MF commodity Stock & Gold

      more on my blog or mail me

  24. QUESTION:
    What is the best plan for retirement if my wife and I are starting right now at 30 yrs. old?
    We are also in the national guard and are eligible for the Thrift Savings Plan. I have heard that that is very good but don’t want to jump into anything.

    • ANSWER:
      You should definitely consult a professional. If you are banking with USAA, then call up their investment advisers, they don’t work for profit – they can guide you in the right direction. You should contribute to your TSP, as this is a wonderful investment, based upon your retirement date, as I’m sure you know. You should also max out your Roth IRA every year (,000) for you as well as one for your wife.

      The more you can put away now, the faster your retirement savings will grow.

  25. QUESTION:
    what is the best investment plan for retirement?
    Hii…I’m Harto now 39 old, would like prepare for my retirement plan…what is the best investment plan…thanks you

    • ANSWER:
      hi,
      i just want to say, if you are looking information about how to calculate your retirement planning, go to this site,

      http://www.stock-investment-made-easy.com/retirement-planning.html

      it offers step by step calculation on how you should go about retirement planning. you’ll discover how much you should save to survive in your retired life.

  26. QUESTION:
    for mid-income americans who live abroad, what is the best retirement plan?
    An American in his 30s, living in Japan with his Turkish wife.

    • ANSWER:
      Do you have earned income? Are you filing your tax return in the states? If so, you might still qualify to open and contribute to traditional IRA or ROTH IRA. If you’re self-employed, you might be qualified to open a SEP IRA where the maximum contribution limit is 42,000 or 100% of income.

      Definitely do save/invest in addition to IRA limit for a secure retirement.

  27. QUESTION:
    Retirement planning and options at age 26?
    I’m 26, Single, Male earning about 3 lac p.a. in Delhi, India

    I wish to start planning and investing / saving for retirement ASAP.

    Can someone guide me with best retirement plans that I can consider and various other options that too should be included for a safe and healthy retirement corpus.

    Consider me not doing any investment right now and give your answers for a starter in Job.

    • ANSWER:
      You are someone in the initial years of your career. I am glad that you are asking these questions now. There is nothing like starting early, in your investing life and use the power of compounding to your advantage. To understand power of compounding, consider this excellent article at http://www.valueresearchonline.com/story/h2_storyView.asp?str=4007

      Next, you can invest in a mix of the following strategies, depending on your investing risk profile, as indicated below. Invest only those funds that you do not need. Get in the habit of saving 30-35% of your salary regularly. Create an emergency fund, roughly equal to 4-6 months of regular monthly expenses. Once this is covered, you may have funds that you will not need say for next 3-5 years for regular or emergency expenses. Use these funds to invest wisely. You need to remain invested for the long term, since you want capital growth.

      Conservative Risk Profile (you seem to be of this type; someone who wants his principle to be secure and is looking for a decent growth over the long term)

      1. PPF (Public Provident Fund) – account can be opened with any State Bank of India branch. This gives you a compounded 8% return per year, is currently tax free, and is the safest instrument available. Invest 50% of sparable funds in that

      2. A Balance fund like HDFC Prudence Fund – This Mutual Fund invests in both equity (65%) and debt (35%) instruments. This is one of the safest funds with a great track record of over 14 years, and has been giving a compounding return of around 20-25% per year. This fund has one important virtue: it manages to lose less than the category average in periods of downside. Couple this with its tendency to top charts & you get a safe & sure fund in HDFC Prudence. Invest 30% of the funds in HDPC Prudence.
      check out HDFC Prudence fund analysis at

      http://www.valueresearchonline.com/funds/fundanalysis.asp?schemecode=600

      3. Equity Diversified MF -like SBI Magnum Contra, Reliance Growth.
      These are funds having a very good long term record in delivering great returns with low to average risk. They have figured among the top fund ratings for a very long time. Invest the balance 20% in funds like these
      Check out more on the top rated funds at http://www.valueresearchonline.com/toprated.asp

      Moderate Risk Profile (someone who can take a little more risk with some of his money)
      PPF -40%; HDFC Prudence -30%; SBI Contra or Reliance Growth fund -30%

      Aggressive Risk Profile (someone who can take higher risks with some of his money)
      PPF-20%; HDFC Prudence -30%; SBI Contra or Reliance Growth – 50%

  28. QUESTION:
    which is the best retirement plan when retirement is three months away?

    • ANSWER:
      None, three months out is too late to begin retirement planning. Good luck.

  29. QUESTION:
    best Retirement Plan?
    I have secured a job as a physicist and I am 24 years old, just out of college, and i have secured this job starting at 2,000 per year. i am clueless with finances, AIl i am asking out all the plans out there, what would be the best type of plan for me, all I know is that i am ineligible for Roth IRA because it has a 100,000$ limit. Please help

    • ANSWER:
      First, find out if your employer offers a 401(k) or 403(b) retirement plan in which they will match all or some of your contributions. That should be your first choice because that match is the same as getting a 100% return on that part of your contribution.

      Further, if your employer offers you the choice of contributing to that 401(k) or 403(b) plan on a post-tax basis, take that option. It is also called a Roth 401(k) or Roth 403(b). Since you are so young, most of the money you accumulate in that plan will be from earnings by the time you retire. With a Roth 401(k) or 403(b), all your earnings are tax-free as long as you follow the rules. Essentially that means you cannot withdraw earnings until age 59 1/2. You can withdraw contributions at any time without penalty, but leaving them intact assures you more earnings.

      Most businesses offer the 401(k) plan, either as a traditional (pre-tax) option or a Roth (post-tax) option. Educational institutions and some non-profits offer 403(b) plans.

      If you are not able to contribute the maximum to both a Roth IRA and a Roth 401(k) or Roth 403(b), then contribute just enough to get the employer match and then put as much as you can in the Roth IRA.

      By all means, contribute as much as you can to the Roth IRA, at your age, up to ,000 for this year and ,000 for 2010 tax year. You have until April 15, 2010, or later if you file for an extension to make your 2009 tax year contribution to a Roth IRA. So, within the next two months, you could contribute up to ,000 in a Roth IRA. However, if you did not earn at least ,000 in 2009, you would be limited to no more than 100% of your 2009 earned income (wages). For example, if you earn ,923 in the last two weeks of 2009, and you had no other wage income in 2009, the most you would be able to contribute to a Roth IRA would be ,923 for tax year 2009. Anytime after January 1, 2010, you can contribute up to ,000 for the 2010 tax year. If anything happens and you don’t earn ,000 in 2010 (unlikely) you can withdraw the excess contribution plus earnings without penalty anytime before you file your 2010 tax return.

      Good luck! And, congratulations.

  30. QUESTION:
    best retirement plan?
    Best retirement plan for some one over 55
    years old. What is the one that will give you more for the money you put in.

    • ANSWER:
      the

      The 401k…. this especially if your company does in funds matching. If this IS your retirement you will need to decide how aggressively to invest it. I would choose a large cap or mid cap mutual fund.

      Soccerref

  31. QUESTION:
    what are the best retirment plans for a young adult?
    HI, i’m 19 and trying to find some information so at the end of the summer i can open some kind of retirement plan. I have researched ira’s, roth ira’s, mutual funds, stocks, bond, etc…now I just want to know what would be the best way to approach this as a young adult with limited funds( couple thousand). Also ive looked into different places such as schwab and Scottrade, any opinon on a good firm would also be helpful.
    Also i guess i should have added, i am a college student and my source of income are my summer internships.The money im earning, i want to invest it because other wise ill blow it on stupid stuff when i go back to college.

    • ANSWER:
      Congratulations on starting at such a young age.

      If you have earned income, you can deposit up to 00 a year into a Roth IRA.

      Take a look at the target retirement funds at Vanguard. The target funds invest the money into a few different funds and they are more aggressive early and automatically adjust to more conservative as you near retirement age. This simplifies the whole process a bit.
      Take a look at this Vanguard target Retirement Fund 2050…

      https://flagship.vanguard.com/VGApp/hnw/funds/snapshot?FundId=0699&FundIntExt=INT

      Good Luck

  32. QUESTION:
    I am 18 years old. What kind of retirement plan is best for me?
    I was in school one time and they told me if i start putting money away at 18 years old it would accumulate to a pretty good amount later on in life. I heard someone say something about a Roth IRA and how how can touch the money without penalties. What would be best for me?
    also im planning on going to an edward jones officer. would a visit cost me anything

    • ANSWER:
      With a ROTH IRA you can take out your contributions with out penalties but not the IRAs earnings, before you reach the age of 59 1/2, so this is my preferred retirement plan.
      Back in 2004, Edward Jones paid a million SEC fine for directing investors toward “preferred, better for you” mutual funds. What they didn’t tell investors was that they were getting kickbacks from the funds to sell them so the funds were “better for Edward Jones, not investors.” They made about a 0 million profit on the deal minus the million fine, crime did pay for them. Just make sure you do your own research and don’t bindly trust what ever the Edward Jones officer recommends.

  33. QUESTION:
    What is the best retirement option for someone that wants to save on his own?
    I am a foster parent and I get paid by my agency through a per diem. That means the money I get paid is tax free. And since I don’t have a full time job, I don’t have a retirement plan. I want to start saving for the future. Can any one help?

    • ANSWER:
      Although you don’t have a retirement plan through your employer, you still have good options.

      If you have a spouse that does have a retirement plan at work, you can probably contribute to what is called a “spousal IRA.” You get the right to invest through your spouse’s earned income. Like any other IRA, there are two types, the Roth and the Traditional. Unless your spouse makes a whole lot of money, I’d suggest the Roth. Just mention that when you open your account. You have to file your taxes jointly and make less than 6k (in 2007), but you can contribute up to 00 (in 2007).

      If that situation doesn’t apply to you then you might be able to contribute to an IRA yourself using the money you earn as a foster parent. Check in with the IRS by calling their hotline and they’ll be able to tell you right away. I’m guessing the answer is no since your income is not taxable, but I am not a tax lawyer.

      Finally, if you can’t contribute to an IRA, nothing prevents you from starting an account with any number of brokerage houses like American Century, Charles Schwabb, or Fidelity.

      Without the tax advantages of an IRA or an employer’s retirement plan, you’ll want to be careful not to choose investments (especially mutual funds) that throw off lots of taxable income.

      For newcomers to investing, I like to recommend a basic S&P 500 index fund. They have good inherent diversification, low fees, and tend to be pretty tax-efficient. There are many examples, but one example is Fidelity’s Spartan 500 fund, found under the ticker FSMKX.

  34. QUESTION:
    Question about retirement plans?
    I’m trying to figure out what I want to go into, but I’m a little confused on retirement plans. I know that cops/teachers get the best retirement plans compared to other fields, but how much better? I know that teachers get their plans by how many years they work times 1.5% or something like that, but what about a different job, like a physician assistant? Please, I need help!
    no, im not saying i’d be miserable doing that…i actually want to be a teacher, but i know that they arent paid that well, so i guess im asking if the retirement plan balances that out??

    • ANSWER:
      I don’t recommend choosing a career based on the potential retirement plan because they can always change in the future. Some corporations have retirment plans that far exceed government plans. You need to go into the type of work that’s suited for your skills and personality regardless of the benefits. If you love what you do and excel at it you’ll make ample money no matter what type of benefits are offered at work. You can always invest using an IRA, which is an Individual Retirement Account. It’s for individuals and you control it no matter where you work. There are also retirement plans for those who are self-employed, if you choose to work for yourself.

  35. QUESTION:
    Best retirement plan for future?
    I’m 18 and thinking of my retirement plan for the future.

    I want to have million by the time I retire at 65.

    • ANSWER:

  36. QUESTION:
    What is the best retirement plan for a young adult?
    Also, is it best to open an Vanguard retirement plan with this economy?
    I’m 23 yrs old. I have a 401k plan which I contribute the minimal 3%. My employer sometimes matches at 1.5%, most of the time lesser. I should be happy my employer offers a 401k plan as some don’t even offer one but I’m unhappy with the contribute amount. I’m thinking of opening IRA account with Vanguard and contribute a month or maybe more. I’m clueless to retirement plans. Can I have a 401k plan and IRA account with Vanguard or I can only have one retirement plan? How does vanguard works? What is the best retirement plan? I have research online but have come up with too much info and it just seem so complicated.

    • ANSWER:
      y not just sock away everything u can in2 savings? doing this leaves u the ability 2 put away flexible amts as yer able. what u use can B replaced L8r

  37. QUESTION:
    What is the right time to start ‘Retirement Planning’ ?
    When should one start planning for retirement years and what is the best retirement plan?

    • ANSWER:
      Start as soon as you start your job. Find out what kind of retirement plans the employer offers.

      The three major elements of your retirement portfolio are benefits from pensions, savings and investments, and Social Security benefits.

      Each year the Social Security Administration sends you your personal Social Security Statement, which gives you an estimate of the monthly benefit amounts you and your family may qualify for now and in the future.

      Once you’ve reviewed your Statement, you may want to explore a variety of retirement scenarios using a range of assumptions about your future earnings or when you stop working.

  38. QUESTION:
    Young, single, self-employed female looking for best Retirement Plan?
    I am 24 years old and the sales and event director of a booming event venue. I have a passion for my job and am expecting to make a ,000+ commission at year’s end on top of my ,000 guarenteed salary. Unfortunately, I am
    10-99′d. But I do have a signed agreement that my employer will pay (tax free) the extra 7.65% that I normally would not have to pay if I was on a regular payroll. I get paid weekly (6.92/week). I have trying to set aside money to pay my taxes that I will owe, but it is hard.
    1.) How much should I be saving a week to cover my taxes at the end of the year?
    2.) Should I file taxes quarterly? And how do I go about doing so?
    3.) Beyond saving for taxes I would like to invest in some sort of retirement plan or 401K or something that will gain interest. What would be the best route to take? I do not have a substantial savings to invest intially. Do I have to deposit a minimum amount to get started?

    Thanks so much for anyone who tackle this one!

    • ANSWER:
      As a 1099 employee, you are officially self-employed meaning you can set up a SEP IRA, a Roth or a traditonal. You need to talk to a brokerage firm to determine your risk tolerance.

      For the taxes, you do get to write off your work expenses which helps with the tax burden. But without knowing your write offs it’s hard to deterimine your tax bracket. Minimums are usually 0.

      Based on 2007, your tax liablity would have been 15,180 plus the social security payment for being self employed. Your state tax will depend on the state you’re in.

  39. QUESTION:
    what is the best investment /retirement plan for a mom who hasn’t worked due to husbands support .?
    I am a stay home mom for 16yrs. , my husband never wanted me to work , at the time when my kids were small I was busy in their care. Now , I am thinking what will I do if something happened to my husband, how would I manage to take care of myself? What are some good investments I could make to safe guard myself for the future. I have just started to work in a private dr. office but I am thinking of changing to a gov. or state job because they have better retirement benefits. Thankz for your time.

    • ANSWER:
      First off, make sure you and your husband have a good term life insurance policy. That way, if something does happen to him, that you will be well supported.

      On top of that, you can put your money into a Roth IRA and it will grow tax free. Other than that, you can invest in mutual funds. They tend to perform pretty well over the long term.

  40. QUESTION:
    What are the best steps to take in retirement planning? Given today’s economy how safe are IRA’s?
    My wife and I are both 31 years old, and we want to start saving for our retirement. We’re interested in starting a Roth IRA, but with today’s economy, we really don’t know if that’s the best choice, or with which company to go with. Basically we just need some advice.

    • ANSWER:
      IRA’s in and of themselves are not inherently safe or unsafe, it depends what investments you put in them. You can buy US Treasuries which are totally safe, but have terrible returns. In the long run, stocks and stock mutual funds provide the best return. If you’re concerned about current conditions, don’t buy stock or stock mutual funds. But if you wait for times to get better, you’ll be buying both at much higher prices. The best strategy is to buy slowly over time. That way you buy more shares at a lower price and fewer shares at higher prices. Dollar cost averaging. http://www.investopedia.com/terms/d/dollarcostaveraging.asp

      Whatever you do, best of luck to you. Saving for retirement at 31 is a great idea.

  41. QUESTION:
    Best Retirement Plan in USA?
    I am 26 year old female. My company doesn’t provide any retirement plan like 401K or something.
    Where else I can plan for my retirement. Since I have time, i can probably go for some safe plan.
    Also tell me if by chance I have to take out my money from my retirement plan before my retirement , what happens?

    • ANSWER:
      You should definitly open a Roth IRA. It’s the BEST retirement savings vehicle there is, especially if you don’t get a 401k match (and certainly if you don’t even have a 401k).

      1. You can put in 00 in 2007 and 00 in 2008. Annual limit goes up with inflation after that.

      2. You don’t pay income taxes on any gains, interest, or dividends EVER. With a 401k or Traditional IRA, your contributions grow and compound tax free (you dont’ owe taxes each year), but when you take the money out, you pay income taxes then. That means if you have ,000,000 in a 401k, you can really only take out 0,000 because you’ll owe taxes of 0,000 (30% bracket). With a Roth, the whole million is yours to enjoy

      3. Roths are flexible–you can your contributions back out ANY time for ANY reason no matter how old you are. You can’t take out your gains on those contributions until you’re 59.5 though (exceptions include buying a home, paying for education costs, becoming disabled, etc. Then you can take out gains early with no penalty).

      I recommend Vanguard for a no-fee IRA. Very low expenses, great reputation, large array of solid funds, etd. Fidelity is a good 2nd choice.

  42. QUESTION:
    what’s the best retirement planning website?
    preferably free, preferably not sponsored by a financial product

    • ANSWER:
      ell, I’ve got 2 of the software programs available for you. The programs that are available are:

      FREE Family Retirement Planner (1,564 KB)

      http://www.kurtteej.com/finplan/fam-ret.zip

      Financial Toolkit (833 KB)

      http://www.finplan.com/finplan/toolprg.zip

      I’m currently reviewing what is and is not valid anymore. The tools are in the process of being redepolyed and will be flying the flag again soon. The 16-bit versions of the financial planning software will be available in a few days (a few database tweaks to do first). Look for new 32-bit versions of the software to be available in May.

      C’mon back soon to see what may surface in the future….

  43. QUESTION:
    Best retirement plan?
    the other day i was making a call to my 401k and i could tell thr man was hinting that my money wasnt invested right. I dont know much about these kinds of things and was wondering if someone could help
    me out. What 401k plan would be the best to invest my money in as well as it being stable.

    • ANSWER:
      Basically there are 3 types of investments:
      STOCKS have the most risk, but also the highest payout.
      BONDS are a fairly safe investment, but don’t make to much.
      MONEY the safest place, but hardly any payout.

      Since you want stability (not knowing your age) I would go
      with a mix of 40% stock, 40% bonds and 20% money.
      Thats what you tell your 401K rep.

  44. QUESTION:
    whats the best retirement plan ??social security sounds vague now?

    • ANSWER:
      Not sure how old you are but this will work well enough if you are starting out.
      1. participate in your company 401k as much as you can.
      2. start putting 10% of your paycheck in a bank account every pay day. Does not matter if it is 10% before or after taxes.
      Figure out how much you need to live for 3 months in case you get laid off or lose your job. Remember a vacation or new car is not an emergency
      When the account reaches twice that 3 month emergency fund, then move half of it to a high yield mutual fund. Look for a Morningstar 4 or 5 star fund and I suggest large or medium cap no load growth and equity fund. Look for long term growth and return.
      DO NOT keep moving it, funds go up and down and you can’t chase a dollar here or there.
      Now you keep putting that 10% away in the bank account and when it doubles put half in the fund and keep doing that. This gives you liquid emergency funds and allows what you don’t need for that to work harder for you. As your needs grow ( children, etc.) that 3 month cushion might need to get larger but that is OK.
      Also consider a Roth IRA or regular IRA to defer taxes. It is worth paying a financial advisor to help you work it out. Do not accept free advice from anyone that is selling a product, They will tell you that their product is the best for you. They are being paid commissons on what they sell. Paying for the advise from someone that does not have a financial interest is best. Free advise is worth what you pay for it.

      I also suggest getting a book called ‘The Millionair Next Door’ by Stanley and Denko and ‘The Millionair Mind’ by the same authors. Both give good advise about accumulating money.

      The main thing is discipline yourselfl, use a budget and stick to it.
      If you use the 10% plan you should have at least a million dollars by the time you are 50 if you start when you are 20.

  45. QUESTION:
    Which hospital employer offers the best retirement plan.?

    • ANSWER:
      we use vanguard here i believe, i dont have one set up yet because i know how to take care of my own money lol.

  46. QUESTION:
    what is the best retirement plan?

    • ANSWER:
      1.Live below your income
      2.Save an emergency fund of at least 6 months income (1 year is better)
      3. Don’t go into any debt except a fixed rate mortgage. Financing things that lose value (like vehicles) will end up costing you a bundle in interest charges.
      4. Contribute the maximum to a Roth IRA
      5. Contribute the maximum to your employer sponsored 401(k) or 403(b) {It is better to have more money than you need at retirement than not enough}

  47. QUESTION:
    best military retirement plan?
    I just joined the Army, and I plan on retiring from my career in 20-25 years. However I hear that many military members retire and have to get other jobs to make ends meet because they haven’t prepared for anything. What is the best plan while in the military to retire with? I have a wife and daughter and would like to spend the last half of my life comfortably with them with no fears of money problems. I am currently 23 years old if that makes any difference. And any options are welcome, either through the military or otherwise.Thank you for helping me with my families future!

    • ANSWER:
      You should also contribute to the thrift savings plan. It is like a 401k that is for federal workers. The nice thing about it is that if you do not do 20 years, you can still take the money with you unlike your retirement plan.

      Now you understand that if you retire in 20 years, you will only be 43. If your daughter is a baby now, she will only be 21 and probably still in college. That is why most people need to get jobs. It is virtually impossible for a 43 year old to retire because life does not get cheaper and for those in the military, it gets more expensive. The army will give you bah (basic allowance for housing). The amount is based on your geographic area and your rank. The great thing about it is that it is tax free. Once you leave the service, you no longer get bah. You only get your retirement. There are two ways to retire. One is to leave the service permanently and one way is to stay as a retired reserve. Retired reserve is like the irr. You can be called back but you get more in your retirement. The other thing that you receive your retirement without penalty once you retire. You cannot do this with civilian pensions or 401k. Typically there are age requirements.

      The smart thing to do is to make sure that you get an education while you are in and that you try to get a job that is marketable. That way you can get a good civilian job when you get out and you can bank your retirement. If you do that, and you do not have tons of bills, you should be able to completely retire around 55.

      Basically, what you should try to do is to bank your bah amount. That is hard to do because you will have bills but if you are able to do this, you will have a nice amount of money put away for emergencies and for your child’s education. If you cannot bank the entire amount – go for 25% and increase it over the years.

      Try to keep your costs down. Live on or close to post. Do not buy big cars and other toys. Keep your load light and you will not regret it. The more stuff you get, the more you have to haul. Keep your monthly expenses as light as possible. Go cheap on cell phones and other stuff that can be expensive and you will not go wrong. What many people fail to do is to look at the long term costs of things like cell phones. I believe that the iphone with internet is about 75 dollars a month. That does not sound like a lot but do the math. This costs 900 dollars a month and in 10 years it is 9,000 dollars. If you saved this amount your would have 9,000 dollars plus interest.

      Be careful with credit cards. Keep some cards so that you have a good credit score but use them wisely and pay them off immediately.

      If your wife wants to work, make sure that she has job training so that you are not paying more for childcare than what she is bringing in. She should check with the post education center to see what programs she qualifies for. Make sure that she does work once your child is in school. Even part time because it will help with her social security later in her life.

  48. QUESTION:
    which is best retirement plan in india?

    • ANSWER:
      jeevan aanand offered by LIC

  49. QUESTION:
    24 married looking for best way to start retirement plan?
    I really don’t have any idea where to begin my company dosen’t provide any benifites

    • ANSWER:
      you should look into either a traditional (pre-tax) or roth ira.(after tax). both have annual limits but if you start now you have plenty of years ahead for your investments to grow. one company that offers a wide variety of options is fidelity.com. congratulations on starting this early in life.

  50. QUESTION:
    What is the best Retirement fund to invest in? How do I get started?
    Planning retirement

    • ANSWER:
      If you are just getting started on retirement funding, my assumption is that you are in your early twenties. With that in mind, I have a lot of suggestions.

      #1 is to make sure that putting money into something like an IRA or 401K is timely. I wouldn’t put a dime into either unless you already have a short term emergency fund of about 3 months net pay as well as any other funds needed – like more education, money for a wedding/honeymoon etc. If you don’t do this, life will most likely bite (like it did to me years ago) and then you end up pulling the money out, paying taxes and penalties. OUCH!

      #2 get a copy of Dunn and Bradstreet’s guide to investing. They use a pyramid/tiered approach, and the emergency fund is the first tier – BEFORE putting money into an IRA/401K.

      #3 Next is a budget that sets money aside for home ownership. Home ownership historically has been a better investment than an IRA or 401K, so you want to make it a priority. If you can’t pull off setting $$ aside for both the IRA/401K AND the house – MAKE THE HOUSE THE TOP PRIORITY.

      #4 Investments after the house should be conservative at first (many years) – don’t try to buy a protfolio of Almagated High-Tech Upstart Dohickey Inc. Odds are you’ll lose your hard earned dough and more importantly all the years of compounded interest. Do a calc on 9% compounded on a 00 investment for 40 years. Why risk that kind of dough on a speculative replacement for the cheese-weenie? Go tried and true, go big blue (chips) initially, preferably in an index fund to spread the risk further.

      Anyway, Louis Ruckeyser I’m not. Get the book, go from there. You’re already doing a great job ’cause you’re thinking in the right direction and asking questions – and not from some investment outfit that just wants your business.