planning my retirement..?
I am at the beinging of planning my retirement. I am 38 I make 8 Dollars an hour, I have a IRA that I put 50$ a month into and NO savings or live insurance. The only thing somewhat for sure right now is I do not want to own a home when I retire. I do not want to be retired and have to do yard work or house hold repairs. I do not know if I will ever make and/or save enough to buy a condo, but have not ruled that out. I am not sure what to do. I have thought about a retirement community with mobile home, but always have the fear of tornado's. I also have no idea how to save and what I need to save. I would like to know who to talk to . I have spoke to a few retirement investors but they sound like they are just trying to sell me there services more then my retirement. HELP!! Chris. the 8 an hour is top of the pay where I am living. And it is a very good job, so leaving is not something I am going to do. I also work a midnight shift for a hotel, so getting a day job or week end job really would be kind of hard.
Public Comments
- First off, get a better job that pays more. That is more effective than saving all your earnings. You might as well not be working if you're only making $8 per hour. Set up a system. Direct deposit at least 10% of your paycheck into a retirement account.
- You do know how to save if you are putting money into an IRA. Good for you. Check out Suzie Orman's site; great for women! I also want to live in a small townhouse or duplex when I retire---no lawn. I'm 48 and not buying anything else for my house that I can't use when I retire. I want to downsize my house, my 'stuff', my responsibilities, be debt-free, and be more relaxed. *You might want to think about getting a wkend job & putting that into your savings as well. Good Luck.
- First of all, unless the IRA is a Roth IRA, stop funding it! You don't need a tax benefit now, with your low wages. Use a Roth IRA, if you think you might want to withdraw during retirement without paying taxes, although you likely will not save enough money for taxes to be an issue anyway. The carrying fees, not to mention withdrawal penalties if needed, on a Roth IRA may surpass any tax savings that you might encounter along the way. I can understand why no one wants to help you plan. At your age and income, your retirement prospects are quite bleak (Also, a $50/month IRA does not generate much of a commission for an advisor). The fact that you have no savings is not a good thing, because you will likely have to take money from your IRA, and pay the appropriate penalties, if you should have an emergency. For now, I would recommend that you stop funding the IRA, and start funding a savings account. If you feel the need to get a better return than available from your bank, you can try the Orange Savings Account from ING or check the account offered by e-Trade. Both offer higher-than-average interest rates for savings accounts, and both accounts are liquid. You may open either from the comfort of your computer. Once you have at least $1,000 in savings, you can start thinking about putting investment money aside. A mutual fund would be a likely vehicle at this point, but then you do increase your risk of loss. Of course, this may be two or more years from now, but you really need to have some kind of ready cash for emergencies. Something always happens! If you don't have children, a spouse, or anyone else depending on your income, your need for life insurance is probably minimal. I would recommend a $25,000 term policy that would take care of your final expenses. Be sure to prepare a will that states your wishes, and leave copies where one can be found upon your demise. I'm not sure how you feel about your job, but you may want to see if you can find an occupation that pays better. I'm sure things are not as comfortable as they could be, and they won't get better in retirement, considering your late start and minimal resources. I do commend you on at least starting some kind of plan. I wish you well. Good luck.
