Retirement?

[zoe08]

We really need to set up a retirement savings for DH. His work does offer for him to go through them and use this American Funds portfolio thing. We got a booklet for it, and I don't understand it at all.

However his work doesn't match anything, and I don't think many people at his work actually use their option for retirement.

So what do you use?

We are thinking about getting an IRA, but I don't know a lot about the different kinds or anything.

 

[xpaeanx]

I'm not sure how much $ you make... but if you can, Roth's are the way to go...

Married, filing joint for 2009:
166K(modified Adjusted Gross Income) and under you can put in 5k a year
166K-176K: $176,000 minus your MAGI divided by $10,000 multiplied by $5,000

and as far as american funds.... personally I like Franklin Templeton a bit better... they fit my goals a little more and I think they're pretty easy to deal with....

 

[Gsd_pitboxer]

Do you think u can make good money making a dog bording place , that can groom and stuff?

 

[CaliTerp07]

Do you think u can make good money making a dog bording place , that can groom and stuff?

I'm not sure how that's relevant?

Zoe, I'm struggling with this right now too. I definitely second XP's suggestion for a roth IRA. In a roth, you pay the taxes now, which means that when you take out the money later, it's tax free. There are a couple benefits here.

1) You know exactly what you'll be able to take out each month
2) Historically, taxes increase overtime. In 40 years when you're looking at retirement (ugh, so long!), taxes will likely be higher than now, so you'll have saved some money

The benefit to doing a 401k through work is that it allows you to save more than just doing an IRA. Your 401k is capped at $16,500 per year (unless your employer puts a percent limit on the amount you can contribute--i.e. 10% of your salary). An IRA only lets you put in $5000 per year.

My 401k at work gives me complete control. They gave me a list of the 20-30 funds they have available, and I got to pick how much I wanted to put into each fund. I was lucky to have a financial adviser for a roommate at the time, so he told me how to divvy it up. Otherwise, a little internet research will get you there. You guys are young, so you want riskier stocks. I had the option of selecting the decade I wanted to retire in, and they had funds specifically for that group, with the right amount of risk.

 

[ACooper]

My 401k at work gives me complete control. They gave me a list of the 20-30 funds they have available, and I got to pick how much I wanted to put into each fund.

This is how Kevin's is too. He can mix and switch anytime he wants right online. His job DOES match his contributions, and they also have profit sharing which they dump in once a year.

I do believe his work 401 is through Wacovia now.........but it has changed hands several times in the last 10 years so I am not certain, LOL

 

[Bailey08]

FYI, there's new legislation that allows you to convert a regular IRA to a Roth IRA without being subject to an income cap. So, you can convert to a Roth IRA even if you exceed the maximum AGI to open a Roth in the first place. Here's the Roth IRA website: Roth IRA Web Site Home Page There's also an article on that site about the benefits of the Roth IRA vs. a 401(k). You can invest in both a 401(k) and an IRA (subject to the individual limits Cali listed above).