Take the back door into a Roth IRA

investing2If you’re a high-salary-earner and are looking for ways to put away a sizeable portion of your income for retirement, traditionally your options have been limited. Employer-sponsored retirement accounts like 401(k)s and individual accounts like IRAs have contribution limits that cap how much you can put in each year. For example, Roth IRAs have a limit of $6,500 per year for those age 50 and over. And if you make over a certain limit ($131,000 for singles in 2015) you can’t open a Roth IRA at all.

But under recent IRS rules, you have a potential way around that. Some are calling it the mega-backdoor Roth because it allows you to sock away larger amounts into your Roth IRA, if you qualify.

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Four retirement myths you (might) think are true

retirement2For many people, retirement involves a plunge into an unknown realm for which they are not sufficiently prepared. Like every life transition, retirement goes much more smoothly with proper planning. Here are four misconceptions that many people have about retirement.

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Is your body on a “slow simmer”?

humanbodyInflammation is part of the body’s response to foreign invaders, such as bacteria, viruses, and allergens. It’s also caused by irritants like pollen, dust, and damaged tissues. Inflammation is triggered when certain hormones in your body call for your white blood cells to come and clear out infections and damaged cells. When the threat has passed, the inflammation recedes and the body heals.

Often, however, inflammation turns on and never fully turns off, instead becoming systemic and chronic. Inflammation is a widespread problem in the U.S. Many of us are walking around on a “slow simmer”, as Nurse Practitioner Marcelle Pick says.

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How a government pension may reduce your Social Security benefits

cointowersThe Windfall Elimination Provision (WEP) is a little-known rule that reduces your Social Security retirement benefits if you receive a pension from a past job in which you were not required to pay Social Security taxes. It’s little-known because it applies only to a small segment of retirees. Mostly it applies to former state and local government employees, like police officers, firefighters, teachers, and workers at state and local governments and nonprofit organizations that are not part of the federal Social Security system.Continue reading

Survey says: you may not need as much retirement income

moneyinhandFor people close to retirement who are feeling anxious about having sufficient funds, there’s some good news. A survey by T. Rowe Price of new retirees found that most are doing well, both financially and emotionally, and that retirees are less anxious than those who are approaching retirement. The survey also indicated that the retirees, who had been retired for one to five years, weren’t spending as much as they had expected, but were satisfied with their retired lives nevertheless.Continue reading

The four percent rule, revised

percentThe venerated four-percent rule states that retirees can safely withdraw four percent of their retirement savings per year without running out of money in retirement. For example, if a retiree has $1 million in a retirement account, they can take out $40,000 the first year, and annually adjust that figure for inflation.Continue reading

Get paid to travel

airportsignEven after retirement, many people are looking to stay employed part-time. Some retirees look at part-time employment as a way to stay occupied, others as a way to supplement their retirement income, and still others as a way to remain productive and contribute. But finding meaningful and fulfilling part-time employment can be difficult for seniors.

How about getting paid to travel? Many people list that as their #1 dream job – but that’s what it is, just a dream, right? In this video, Wealthy Retirement’s investment advisor Steve McDonald interviews a lady who has been getting paid to travel for a quarter-century. She tells Steve how she got started in the travel industry (she runs a travel agency) and gives some tips for how other retirees can get started, even if they come from other backgrounds.

Click here to watch the interview or see a written transcript.

Looking for a good place to retire? Try Zillow’s interactive map

usmapAre you looking to move when you retire? Many people are looking for a change of scenery to begin their golden years. Moving to a place with lower taxes or cost of living, better weather, or better access to retiree activities … the reasons to move are endless.

Where’s the best destination to retire? Well, of course that depends on what’s important to you. To help you decide, Zillow, the online real estate information company, has dipped into its extensive nationwide database to display the most attractive neighborhoods based on several criteria. You can choose which factors are important to you – crime, weather, reasonable home values, access to healthcare. The map gives you some ideas to consider when you start picking your next place to plant roots.Continue reading

Short of retirement funds? Here are some suggestions

fiverinhandIf you’re approaching retirement and worried that you don’t have enough saved, you have plenty of company. Financial advisors see clients every day in their fifties and even sixties who have little retirement savings. The median amount of retirement savings of Americans age 55 to 64 is $103,000. A survey by the Center for Retirement Research at Boston University found similar results and concluded, “many Americans need to save more and/or work longer.”Continue reading

Early retirement – how to get there

beachchairA dream of many people is to retire early. Leaving the daily 9 to 5 grind at age 60, 55, or even earlier, and having the day and the rest of your life free to do as you please, is an appealing vision. But how do you actually get there? For most people there are ways to make the dream a reality, but it takes planning and some adjustments.Continue reading

Do you have enough saved for retirement? Here’s how to start figuring

calculatorDo you have enough to retire?

That’s the big question on the minds of many people who are close to retirement. While many websites like this one will help you compare your savings to those of others, the truth is that how much retirement savings you will need is a personal decision and different for everyone.Continue reading

Why to pay yourself instead of your child’s college

collegeMany middle-aged, middle-class couples today find themselves in a bind. On the one hand, they know they have to save for retirement, and worry they aren’t saving enough. On the other, college tuition bills are looming, and they want the best for their children. Financial advisors recommend making retirement saving the priority. Here are some tips for doing that.Continue reading

Why withdrawing your retirement savings in chunks may be good

stackofbillsHow much of your retirement savings should you plan on taking out each year? Many retirees’ number one fear is outliving their savings, and that’s a question which is at the top of their minds. A common figure is the “4 percent rule”, which says you should plan on taking out no more than 4% of your savings each year. In today’s low-interest environment, many financial advisors are recommending even lower amounts, closer to 3 or even 2 percent.Continue reading

A simple test for healthy brain function

brainAs people age, many worry about losing their mental capacities. Experts cite activities like regular physical exercise, maintaining social interactions, and cultivating hobbies like learning a musical instrument or foreign language in order to help people stave off declines in mental faculties.Continue reading

Retirement planning: More than dollars and cents

retiredlifeWhen most people think about retirement planning, they focus on having sufficient savings and income to enjoy a comfortable retirement. Certainly, financial planning is a crucial part of planning for retirement – without sufficient income and savings, you may not be able to retire when you want, or have the lifestyle you envision.

But many people overlook another important part of retirement planning: planning for the retired life. After 40-plus years in the workforce, retirement is a major adjustment and many enter this phase of their life unprepared for what awaits.Continue reading