The Complete Retirement Planner Blog

Using The Same Return Rate For All Years Of A Financial Plan May Inflate Your Results By 40%

One of the most crucial parts of creating a financial plan is determining the expected return rates on your investments. How much income those investments will be able to generate both before and after retirement will be integral to determining how long your savings may last, but you have to be realistic. To calculate the returns on your investments, most calculators and planning tools allow only one return rate to be entered for all years. Unfortunately, this assures that the results will be skewed, and not in your favor (explained below). For this reason, if you have the opportunity to...

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Inflation And Your Retirement Plan - A .25% Rate Increase Can Equal 25 Years Of Health Care Costs.

One component that all retirement planning tools (even calculators) have in common is that they use an inflation rate as a factor. Some allow you to enter your own rate (highly recommended), and some assume a rate for you (be careful - one "planner" on a very reputable site assumed an 8% annual rate!). The question is - how much of a difference does an inflation rate really make in the grand scheme of things? How much will it affect the amount that you need to save for retirement? The short answer - it makes a tremendous difference.Financial advisers often...

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A 401k May Not Be The Slam-Dunk It Appears To Be

Have you ever been dissatisfied with your 401k investment choices? Or thought that maybe you could do better investing on your own but don't want to miss out on the tax savings from a 401k? Maybe you can have the best of both worlds. A 401k is an important, and advantageous, retirement tool, but it doesn't have to be your only option for retirement savings. The following is not meant to discourage you from using a 401k for retirement savings in any way, only to suggest that it is not the only strategy worth considering.Every article written about the best...

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Retirement Planning Is Easy. Pre-Retirement Planning Is The Problem.

I really wish that someone had explained to me just how financially important the first 20 years of my working life would be to my final 20-25 years on this earth. I’m pretty sure that I would have made some different decisions and paid a little more attention to the possibilities. In theory, I could have stopped saving for retirement at age 45, let those savings grow for another 20 years, and still had a sufficient retirement fund. But the term “retirement planning” didn't come into focus soon enough since it was a little misleading at face value -    it’s...

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Instant Gratification vs. A Sound Financial Plan

Although this blog concentrates on properly planning for retirement (not taking shortcuts), there will always be those who want some instant gratification when determining how much they should be saving. While there is no substitute for a well thought out financial plan, the following is a general guideline for how much you might want to save using age milestones:Age 35 - 2x your annual income Age 40 - 3x your annual incomeAge 45 - 4x your annual incomeAge 55 - 7x your annual incomeAge 60 - 8x your annual incomeAge 67 - 10x your annual incomeNow that I have acquiesced,...

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