Ten ways smart couples can finish rich
(NAPSI) — Every day, some 10,000 Americans retire. If you hope to be among them someday, a few suggestions could help you see more gold in your golden years.
“It’s important for couples to sit down and have a discussion about their retirement plans,” advised David Bach, vice chairman of Edelman Financial Services.
What You Should Know
Consider these 10 steps to a secure and happy retirement:
1. Smart couples work as a team on their retirement goals (without fighting). You should know how much each of you is putting into your respective retirement accounts, whether that amounts to the maximum allowable contributions and what your respective vesting schedules are. You also need to know how much money each of you will get from Social Security and what any pension benefits will be.
2. There are key financial decisions every couple needs to make. The first step toward building a solid foundation around money in your marriage is to have a candid conversation in which you openly discuss the basics and share your financial experiences, hopes and fears. Perhaps you can plan a money date and take turns answering such questions as: What’s your biggest financial fear? How did your parents manage money? What’s your biggest short-term financial goal?
3. Talk about your money openly and honestly. Find out how your partner feels about money and his or her vision for the future. Recognize what it takes to build a retirement fund together and learn the effect of taxes and inflation.
4. It’s a good idea to review your life insurance policies every year or two. You should also know the current value of your home, the size of your mortgage, the interest rate on the mortgage and how much equity you have in your house.
5. Invest in retirement plans and IRA accounts. You have to know where your money is. Between all the 401(k)s, 403(b)s and IRAs collected over a couple of careers, it can be easy to lose track if you aren’t careful. You should know the nature and size of all your investments (including cash, checking accounts, savings accounts, money-market accounts, CDs, treasury bills, savings bonds, mutual funds, annuities, stocks and bonds, real estate investments, and collectibles such as stamps, coins, artwork and so on) and know where all the relevant paperwork is kept.
6. Be sure to follow all the new retirement investment rules.
7. Plan for long-term care and provide for your family’s future financial needs.
8. Build your retirement basket three ways. Always pay yourself first. Contribute as much as possible to a pretax retirement account. Know where your retirement dollars are and what they’re earning.
9. Build yourself a security basket. This should consist of a cash reserve, wills and trusts, life insurance, and health and disability insurance.
10. Build your dream basket, too. List your dreams (be specific) and start working toward them right away.
This advice comes from Bach’s No. 1 national best seller “Smart Couples Finish Rich.”