Many investors understand the basics of Roth conversions, however just as many do not. In this blog we will discuss the basics of Roth conversions as well as why you might do them, when you might do them and how you actually do them.
When you retire from your cooperative you have several options on how to receive your R&S pension. For example, you can take it as series of payments, you can take it as a lump sum distribution or you can do a combination of both. For those of you interested in the lump sum distribution, I want to make sure you avoid a critical mistake that I have seen retirees make.
Let's Make A Deal! (With your R&S Pension)
I started this firm to help people, specifically electric cooperative employees, with retirement planning. I worked for an electric cooperative for over 11 years and during that time I saw a need for retirement planning above and beyond what NRECA is capable of providing you.
What if your cooperative is looking to downsize or maybe shed some of it's payroll to increase their bottom line? What if they start offering "early retirement" packages? For some of you age 59.5 or older it's a great deal and almost a no brainer ...as far as the decision making process goes. Take that money and run! But many of you are stuck in that 50-58 age range where the thought of retirement can be a little scary. You thought you had several more years to prepare and suddenly you have to make the biggest financial decision of your life in 60-90 days. Talk about an emotional roller coaster. I can't even imagine. Let's look at some options.
If you are eligible for the NRECA R&S Plan, you MUST consider the tax scenarios when deciding whether to take the lump sum option or the annuity option. You essentially have a winning lottery ticket and just like a real lottery ticket, the IRS is waiting for their piece of the action.
The impulse to get out of the market before something bad happens is an impulse in all of us but it's at best only half of a strategy. What impulse would you listen to for re-entry to the market? Impulses don't make a strategy, but they can totally destroy a strategy.
You probably hear the term “financial plan” often, but what does that mean?
Did you know that the S&P 500 Index Mutual Fund available to you through your NRECA 401k options has historically averaged a return of approximately 10 percent? Did you know over that same period of time the average cooperative employee in the 401k plan has averaged a return of only 3.9 percent?
Thinking about retirement? Thinking about investing in general? Trying to decide when or if you'll have enough money? Here's a quick financial tip that you can use right this minute. It's called the Rule of 72.
The secret to investing is complex. There is no silver bullet, there is no pill to take, there is no hot new stock, etc. Everyday we are bombarded by advertisers trying to sell us quick fixes to complex problems.
Everyday the financial “news” tells us the status of the S&P 500, the Dow Jones Industrial Average and the Nasdaq Composite because these are the three most followed indexes by media and investors. I’ve found through the years that many people have no idea what an index is or specifically what these three indexes represent. Today I’m going to give you a Cliffs Notes version of what an index is as it relates to the stock market, a brief explanation of the three major indexes
The picture associated with this blog shows what the average investor not working with an advisor often does.
It depends on your goals, your long term financial plan, your age even factors into things here. Let's just run through these options real quick.
As your advisor we are a walking talking insurance plan hired to protect one of the largest assets you own, your retirement nest egg. The difference being that unlike most insurance plans we protect you before a disaster strikes, not after the damage has been done.
Retirement has two doors. One leads to a chance of success. One leads to certain failure. Which door will you choose?
