Home > Tag Archives: IRA

Tag Archives: IRA

How Job Hopping is Harmful to Your Retirement Savings

Job Hopping

While some people choose to stay at the same job for their entire career, others have a habit of changing jobs every year or two. This habit is known as job hopping. Job hopping may not be a bad thing if you are young and the positions you hop to are higher paying or with better benefits. However, there are times when job hopping can be harmful to your retirement savings. Cashing Out Should you choose to leave your job after only a year or two, you may think you should simply cash out your 401(k) when you leave. Think again. Cashing out your retirement plan early means you may only be able to receive a portion of it. The reason for this is because early withdrawal usually causes you to incur penalties and fees. A couple of better options would be to move it with you to your new employer, if they allow it, or to roll it into an IRA. Not Being Fully Vested When you are investing in a 401(k) plan, it usually takes three to five years before you are fully vested. If you choose to leave your current employer and go to work for a different company ...

Read More »

Retirement Planning Made Simple

making a retirement plan

Joe Foley is personal finance blogger and the author of ‘We Got Outta Debt’, the story of how his family paid off $68,000 in a little over 3 years. His new book, “Retirement for the Ages” is due out in December. A h the Golden Years. If you’ve saved well, they truly can be Golden, if not so well…. maybe a Silver or Bronze is in your future. Some aspects of how much you save is out of your control. The recession of 2008-09 hit retirement account hard. An AARP survey from 2011 stated that from 2008-2011: 25% of Americans 50 and older emptied their retirement savings 29% claimed their retirements early due to unemployment Many more retirees are carrying debt into retirement While the cause of this is not in your control, preparing for retirement earlier in life definitely puts you in a better place in case any of these events take place. Planning for a recession is a bit extreme, however planning for unemployment and reducing debt are things directly in your control. How do you do this? Follow Grandma’s basics. Create a budget. Just because the US Government doesn’t have one, doesn’t mean you shouldn’t. A Budget, or ...

Read More »

How Often Should You Rebalance Your IRA And What Funds Do You Choose?

Hopefully everyone reading this already has some form of retirement account set up or is planning to get started in the near future. I began contributing to my retirement plan as soon as I had a real job, which wasn’t until I was 26 (it takes a long time to get through optometry school!). I didn’t know anything about the stock market or planning for retirement. I only knew that my employer was offering a match up to 3%,  and I am not one to pass up free money. While I wish I had started saving a higher percentage of my salary from the beginning, hindsight is always 20/20, and I can only go forward. Now that I have been saving and slowly increasing my contributions, I always run into the dilemma of when to rebalance my IRA and what funds to invest in. Since I could never find the perfect answer, I have never really rebalanced. Knowing I should have done this a while ago,  I’m finally taking action, and October 2012 seems like the perfect time. While there are tons of ideas and formulas, it comes down to a few simple steps. As a disclaimer, please remember, I majored in science, not finance. What is your risk tolerance? If potential declines in ...

Read More »