My Retirement Blog
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The Magical Age of 26
If you are able to max out your 401(k) at $15,500 and your Roth IRA at $5,000 for only a single year anytime before you are the age of 26 and can earn 10% annually, the historical average rate of return, then you will end up with over $1 million by the time you are…
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Recovering from a Nest Egg Raid
When you retire, a nest egg is that pot of money that you rely on to generate income year after year. You might have it in some large cap dividend stocks or a batch of CDs or some other income producing asset, that’s a good idea. However, there may come a time when you need…
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Diversification Across 401(k) Portfolios
The latest Yahoo Finance article on retirement, courtesy of TheStreet, is one in which they discuss managing two 401(k)s when both members of a marriage are working. The article itself is merely an extension on the discussion of one’s own diversification in a single 401(k) but I think there are some points that it could’ve…
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How Recessions Affect Retirement Plans
Recessions, or two consecutive quarters of negative GDP growth, have been on many people’s minds lately and this latest article, What job woes mean to you by Chris Isidore, probably doesn’t help. Economic cycles happen and with each economic burst will come a correction of sort, a regression to the mean if you will. However,…
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Roth IRA Contributions from Social Security
If you’re retired and drawing payments from Social Security, you may be wondering if you could use those payments as contributions to a Roth or Traditional IRA. Unfortunately, Social Security is not considered earned income so it’s not counted towards what you’re allowed to contribute towards an IRA. Earned income is anything that is reported…
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Save to Retirement Fund or Emergency Fund?
If you’re just starting out, you may be put to the decision of whether you should fund your retirement accounts or fund your emergency fund. In order to answer this question, you need to have a grasp of your total financial picture and you can do so by asking yourself the a few questions. Does…
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Take Advantage of Dividends
According to Standard and Poor’s (specifically Standard & Poor’s Quantitative Services Group), from January 1926 through December 2007, the dividend component of the total return for the S&P 600 was 40.59% of the return. That’s right, over 40% of the return of the S&P, from 1926 through 2007, came in the form of dividends. Are…
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Defined Benefit vs Defined Contribution Plan
In all the discussion about retirement plans, pensions, 401(k)s, IRAs, you may have heard the term “defined-benefit” and “defined-contribution” plan thrown around and wondered what they meant. Both are employer-sponsored retirement plan types but have slight different characteristics. Defined-Benefit Plan A defined benefit plan, often called a “qualified benefit plan” or “non-qualified benefit plan,” is…
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What Is The Super 401K?
Last December I read about this concept of a “Super 401(k)” that was offered by Devon Energy and discussed in BusinessWeek. This Super 401(k) was super in that employees were given more generous employer contributions in return of surrendering most of the investment decisions. It’s essentially a mix between a pension and a 401(k), because…
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