For all the traditions, Thanksgiving celebrations have plenty of subtle differences. Are the cranberries jellied or sauced? Touch football on the lawn or college games on the TV? The same is true for dream retirements. Will it be a cottage by the lake or a condo in town? Time to play golf or to volunteer? But there are some things all retirement investors can be thankful for this year:
1. An abundance of tax-advantaged retirement savings options
Traditional, SEP, and SIMPLE IRAs allow you to save on a tax-deferred basis. You gain twice. First by lowering your taxable income in the year of contribution and again by watching your investments grow tax-deferred. With a Roth IRA you can look forward to tax-free distributions later on.
2. The increased ease of investing
Today, you can “do it yourself” thanks to the boom in discount brokerage, crowdfunding and self-directed options for IRAs, 401(k) and other tax-advantaged saving vehicles. Plus, you have greater access to the information needed to do your due diligence when choosing investments.
3. Automatic enrollment in employer-sponsored 401(k) plans and employer matching
Participating in an employer-sponsored plan (and offering one if you’re an employer) is one of the most painless and reliable ways to save for retirement. The money is deducted right from your paycheck, before taxes. Because you never see the money, there’s no temptation to skip a contribution. Most employers match a percentage of your contribution, and in return, they help to fund your retirement.
4. The variety of assets you can invest in a self-directed IRA
Be grateful that the days when stocks, bonds and mutual funds dominated retirement savings are gone. Today, you can invest in what you know best, whether that is real estate, precious metals, unsecured notes, or other alternative assets allowed by the IRS.
5. The community of trained financial professionals
They are ready and able to answer your questions on how to save for retirement, how much to save, and how to plan for the day you will no longer be going into work. The initials following their names may vary—RIA, CISP, CFA, CFP, CIC, ChFC—but those accreditations give you an indication of their professional qualifications.
So once you’ve broken the turkey wishbone, licked up the last of the whipped cream, and waved good-bye to your guests, it’s time to think back on everything you have to be grateful for in your life. If one of those is the prospect of a financially secure retirement, don’t wait to get started. Contact an Entrust professional for a free consultation. (Free is something else to be grateful for!)