Broker Check


Over the years I have had the opportunity to participate in several panel discussions and call-in shows focusing on Financial Education. Below are some of the questions asked by attendees or callers.

If my employer doesn't match any investment to my 401k should I just put everything into an IRA instead? Or Should I keep my 401k but start a separate ROTH IRA?

Even if your employers does not offer a matching contribution, it does not mean that the 401k is not a valuable saving tool. Your income tax rate, fees and how much you are able to save are some factors in determining whether to save within the 401k or an individual IRA or ROTH IRA. When contributing to your 401k, set the amount as a percentage not a set dollar amount. As a percentage, your savings grows as your income increases.

My husband and I are 31 and 29, respectively, and we have little savings and no retirement to speak of. Where is a good place to start in starting a retirement fund?

Often couples are unsure of where to start. Creating a Spending Plan is a good first step. It allows you to recognize where you are spending and possibly find room for additional saving opportunities. The Spending Plan also allows you to determine how much is needed in your emergency fund and is the basis for calculating the amount of Life Insurance needed. From there you will be able to determine how much you can save towards retirement each month. Working with a Financial Advisor may help you stay on track and provide a resource to answer questions throughout the process.

I am planning on retiring in a few years after being a teacher for 33 years. I also have a 403b that I contribute to. I am wondering how much I will need in total retirement funds to maintain my modest lifestyle. I always have heard of the $1,000,000 that people need. How does my pension factor into that? Thanks.

Congratulations and Thank you for 33 years of giving to our community!

There are many options when looking at retirement - and those options are increased for individuals with pensions. To determine what amount you will need, the first step is to understand what your pension benefit will be, what your definition of modest is and how your 403b is invested.

Your pension will provide a fixed income for you, and depending on your State, you may also receive Social Security retirement income. This income can be supplemented with your 403b.

There are many choices when deciding how to take your pension - I encourage you to meet with a Financial Advisor who can assist you with those options to determine what is best for your situation.

We will be retiring in a year, both of us will get Social Security. We also have several IRAs, 401Ks and one other small retirement fund. How do we actually get this money? Should we put it all in one place? Should we withdraw it weekly, monthly, yearly, etc?

Two key pieces of information to know to assist in determining whether to consolidate your accounts is knowing the fee structure for each account and what the distribution options are.

Each investment account has fees but the fee structure in each account is not the same. The easiest way to know is to call and ask. Each account statement or website will have toll free customer service number. When speaking to the representative also ask about distribution options, some 401k’s limit distribution options to one time per year or may not offer any options other than a rollover.

If you work with a Financial Advisor, they could facilitate a conference call with you to be sure you have the facts you need to make an informed decision.

From there, how you withdraw the funds will depend on your monthly income needs. Probably the most common is to take a monthly distribution for your living expenses and a one-time distribution as needed for non-recurring or annual expenses.

Also note, at age 72 you will be required to take distributions from pre-tax retirement accounts based on a calculation provided by the IRS. If you have multiple accounts and forget to include one in the calculation, the penalty is 50% of the amount you were supposed to take. So, keeping track of those Required Minimum Distributions is important.

I retired from teaching in June. I hear horror stories that SS will run out. Is this just a rumor?

I wanted to address this question because it is a real concern for both current and future retirees - while I cannot say with certainty what the future holds for Social Security, I can say that the system has been changed many times over the years and I believe we will continue to see more changes in the future.

Those changes include how much we pay into Social Security and when we start taking our benefit. For those born in and after 1960, full retirement age (FRA) is 67. For my parents it was age 65 and for those born in the 1950’s it is a specific month after attaining age 66. Other factors in the funding of Social Security is the wage base, or income level to which income earners and their employers each contribute. While the percentage, 6.20% has remained the same, the amount it is calculated on has been increasing over time. In 2022 it is up to income of $147,000. In 1994 for example, it was not assessed on income over $60,600.

What I would suggest is knowing how much you need monthly or annually in retirement, what your other income source options are and how your investments are allocated to meet your needs. You can obtain your Social Security projects on- line at www.SSA.Gov Current statements provide you with projections that you will notice increases each year. Each year you wait your benefit grows by 8%. Take it early and you forfeit a percentage of your FRA benefit. At age 62 that percentage is 25%, every year, of the amount you otherwise would have been entitled to at FRA. An Advisor could assist you in determining when you (and your spouse) should start taking your Social Security income based on your unique situation.