Retirement Planning

Your Future/Your Retirement… it starts with a simple decision. Will you take control, or leave it up to fate? I recently came across an item that was filled with all the vernacular of the industry and puffy discussions about the bells and whistles that retirement plan providers are promoting, but just like a light bulb turning on, the bottom line became crystal clear. You have to decide to save!

The best way to take control of your retirement is to save.  If you aren’t saving, you need to start, if you are saving, you need to save more. A recent survey published by the PSCA shows that average deferral rates are rising, which is good. On average, eligible employees are starting to defer at least 6.8%.  This is a good benchmark to measure against. In many cases, you may find that your employer matches your deferral… that’s free money. Do you want to leave that on the table and not in your wallet?

I know all about the bills and expenses that crowd our lives and sometimes make it impossible to even find change to spare, but because a 401(k) plan allows you to put money away on a pre-tax basis, you will find that once you make the decision to save, the immediate tax deferred benefit helps you realize that saving is not quite as hard as it seemed. Let me ask you something…. If you don’t save, who’s going to do it for you? How will life after retirement be?

Late last month the IRS announced its new limits for 2014. They are generally the same as 2013. An eligible employee may defer up to $17,500 of his or her compensation on a pre-tax basis. If you are over 50 years old, the IRS offers you a catch-up contribution, to help you reach your goals. You can defer an additional $5,500 towards your annual retirement limit, for a total of $23,000. Alcott’s 401(k) Plan allows you to set your deferral at anywhere from 1% to 75%!*  All you have to do is decide to take control of your retirement and save!  If your employer matches your contribution, you can really start to see the retirement savings add up for you.

For additional information about how to take control of your retirement and start saving, please contact me, Ken Jacoby, Alcott’s 401(k) Plan Manager.  I will be happy to answer your questions and offer you guidance to setting up your retirement security.

* If you are designated as a Highly Compensated Employee, the IRS has some additional regulations that may limit the total amount you may defer.

We do not give tax, legal or investment advice, nor are we, nor is Ken a registered investment advisor. The content in this article is for informational purposes only. Individuals should seek professional investment advice from a counselor of their choosing.

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