{"id":6240,"date":"2017-03-14T21:00:43","date_gmt":"2017-03-15T01:00:43","guid":{"rendered":"https:\/\/kerryhannon.com\/?p=6240"},"modified":"2017-03-14T21:00:43","modified_gmt":"2017-03-15T01:00:43","slug":"best-moves-now-to-retire-better","status":"publish","type":"post","link":"https:\/\/kerryhannon.com\/?p=6240","title":{"rendered":"Best Moves Now to Retire Better"},"content":{"rendered":"<header id=\"story-header\" class=\"story-header\">\n<div id=\"story-meta\" class=\"story-meta \">\n<div class=\"media-action-overlay\"><a href=\"https:\/\/kerryhannon.com\/?attachment_id=3394\" rel=\"attachment wp-att-3394\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" data-attachment-id=\"3394\" data-permalink=\"https:\/\/kerryhannon.com\/?attachment_id=3394\" data-orig-file=\"https:\/\/i0.wp.com\/kerryhannon.com\/wp-content\/uploads\/2013\/11\/the-new-york-times-logo.jpg?fit=1202%2C1056&amp;ssl=1\" data-orig-size=\"1202,1056\" data-comments-opened=\"0\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;}\" data-image-title=\"the-new-york-times logo\" data-image-description=\"\" data-image-caption=\"\" data-medium-file=\"https:\/\/i0.wp.com\/kerryhannon.com\/wp-content\/uploads\/2013\/11\/the-new-york-times-logo.jpg?fit=300%2C263&amp;ssl=1\" data-large-file=\"https:\/\/i0.wp.com\/kerryhannon.com\/wp-content\/uploads\/2013\/11\/the-new-york-times-logo.jpg?fit=640%2C562&amp;ssl=1\" class=\"alignleft wp-image-3394 size-thumbnail\" src=\"https:\/\/i0.wp.com\/kerryhannon.com\/wp-content\/uploads\/2013\/11\/the-new-york-times-logo.jpg?resize=150%2C150&#038;ssl=1\" alt=\"\" width=\"150\" height=\"150\" srcset=\"https:\/\/i0.wp.com\/kerryhannon.com\/wp-content\/uploads\/2013\/11\/the-new-york-times-logo.jpg?resize=150%2C150&amp;ssl=1 150w, https:\/\/i0.wp.com\/kerryhannon.com\/wp-content\/uploads\/2013\/11\/the-new-york-times-logo.jpg?resize=50%2C50&amp;ssl=1 50w, https:\/\/i0.wp.com\/kerryhannon.com\/wp-content\/uploads\/2013\/11\/the-new-york-times-logo.jpg?zoom=2&amp;resize=150%2C150&amp;ssl=1 300w, https:\/\/i0.wp.com\/kerryhannon.com\/wp-content\/uploads\/2013\/11\/the-new-york-times-logo.jpg?zoom=3&amp;resize=150%2C150&amp;ssl=1 450w\" sizes=\"auto, (max-width: 150px) 100vw, 150px\" \/><\/a>\u00a0<em>Here are steps to get your financial situation in shape, whether you are closing in on retirement or just starting out.<\/em><\/div>\n<\/div>\n<\/header>\n<div class=\"story-body-supplemental\">\n<div class=\"story-body story-body-1\">\n<h4 class=\"story-subheading story-content\" data-para-count=\"13\" data-total-count=\"132\"><strong>20s and <\/strong><strong>30s<\/strong><\/h4>\n<p class=\"story-body-text story-content\" data-para-count=\"218\" data-total-count=\"350\"><strong>Learn the money basics<\/strong><br \/>\nTwo books to consider: <a href=\"https:\/\/kerryhannon.com\/?page_id=3461\">\u201cHow to Think About Money,\u201d <\/a>by Jonathan Clements, and \u201c<a href=\"https:\/\/kerryhannon.com\/?page_id=3461\">Heads I Win, Tails I Win:<\/a> Why Smart Investors Fail and How to Tilt the Odds in Your Favor,\u201d by Spencer Jakab.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"261\" data-total-count=\"611\">The Investor Protection Institute\u2019s site, <a href=\"http:\/\/iinvest.org\/\" target=\"_blank\">iInvest.org<\/a>, offers free guides that explain stocks, bonds and <a class=\"meta-classifier\" title=\"More articles about mutual funds and exchange-traded funds.\" href=\"http:\/\/topics.nytimes.com\/your-money\/investments\/mutual-funds-and-etfs\/index.html?inline=nyt-classifier\">mutual funds<\/a>. You might also consider taking a personal finance course at a community college or checking the online offerings on sites like <a href=\"http:\/\/coursera.org\/\" target=\"_blank\">Coursera.org<\/a>.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"284\" data-total-count=\"895\"><strong>Sketch out your monthly budget <\/strong><br \/>\nAdd up the fundamentals (your rent, utilities, groceries, transportation, <a class=\"meta-classifier\" title=\"More articles about student loans.\" href=\"http:\/\/topics.nytimes.com\/top\/reference\/timestopics\/subjects\/s\/student_loans\/index.html?inline=nyt-classifier\">student loans<\/a> and car loans) and subtract from your monthly after-tax pay. Websites like Mint.com and <a href=\"http:\/\/youneedabudget.com\/\" target=\"_blank\">YouNeedABudget.com<\/a> offer free software to track spending and set up budgets.<\/p>\n<p><strong>Read full article here on\u00a0<a href=\"https:\/\/www.nytimes.com\/2017\/02\/27\/business\/retirement\/what-to-do-now-to-retire-better.html?hp&amp;action=click&amp;pgtype=Homepage&amp;clickSource=story-heading&amp;module=second-column-region&amp;region=top-news&amp;WT.nav=top-news\">The New York Times<\/a><\/strong><\/p>\n<\/div>\n<div id=\"supplemental-1\" class=\"supplemental first\" data-between-flex-ads=\"true\" data-pre-height=\"1282\" data-max-items=\"2\" data-remaining=\"337\" data-minimum=\"400\" data-last-item-height=\"537\" data-flex-ad-adjacency=\"true\" data-post-height=\"1282\">\n<div class=\"supplemental-items\" data-supplemental-order=\"0\" data-no-ads=\"true\">\n<aside class=\"marginalia collection-marginalia collection collection-type-column collection-tone-feature collection-section-topics collection-theme-latest-headlines nocontent robots-nocontent\">\n<div class=\"nocontent robots-nocontent\">\n<header>\n<div class=\"collection-meta\">\n<div class=\"collection-headings\">\n<p class=\"collection-marginalia-heading\"><strong>Avoid credit card debt <\/strong><br \/>\nDebt can haunt you for years, affecting your ability to get a <a class=\"meta-classifier\" title=\"More articles about mortgages.\" href=\"http:\/\/topics.nytimes.com\/your-money\/loans\/mortgages\/index.html?inline=nyt-classifier\">mortgage<\/a> or even a job, because employers are known to check potential employees\u2019 <a class=\"meta-classifier\" title=\"More articles about credit scores.\" href=\"http:\/\/topics.nytimes.com\/your-money\/credit\/credit-scores\/index.html?inline=nyt-classifier\">credit reports<\/a>.<\/p>\n<\/div>\n<\/div>\n<\/header>\n<\/div>\n<\/aside>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"story-body-supplemental\">\n<div class=\"story-body story-body-2\">\n<p class=\"story-body-text story-content\" data-para-count=\"292\" data-total-count=\"1372\"><strong>Start saving and investing <\/strong><br \/>\nTake advantage of your employer\u2019s 401(k) or similar retirement plan. Workers under age 50 can contribute up to $18,000 to their employer-provided 401(k) in 2017. Contributions are tax deductible, and investments grow tax-deferred until withdrawals in retirement.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"438\" data-total-count=\"1810\">Invest enough in your 401(k) to qualify for the full match (the amount your employer puts in as a result of your contributions). Most employers require workers to save from 4 percent to 6 percent of pay to get the maximum match. Begin by saving at least 5 percent of your salary and increase the amount by one percentage point every year until you reach 20 percent. Some plans allow participants to schedule automatic increases each year.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"267\" data-total-count=\"2077\"><strong>Diversify investments <\/strong><br \/>\nAim for a portfolio of stocks or stock mutual funds. Equities outperform fixed-income investments over time. Investors more than 15 years away from retirement should consider an aggressive portfolio with more than 80 percent allocated to stocks.<\/p>\n<p id=\"story-continues-3\" class=\"story-body-text story-content\" data-para-count=\"291\" data-total-count=\"2368\">Invest in a diverse mix of low-cost index funds. You might select a trio of funds: a broad United States stock market index fund, an international stock market index fund with exposure to both developed and emerging markets, and an index fund that owns the overall United States bond market.<\/p>\n<p id=\"story-continues-4\" class=\"story-body-text story-content\" data-para-count=\"148\" data-total-count=\"2516\">Another option: Target-date funds, or T.D.F.s, which automatically adjust the balance of their stock and fixed-income investments based on your age.<\/p>\n<p id=\"story-continues-5\" class=\"story-body-text story-content\" data-para-count=\"351\" data-total-count=\"2867\">If you earn enough to save on top of your retirement plan but not so much that you are capped by <a href=\"https:\/\/www.irs.gov\/uac\/newsroom\/irs-announces-2017-pension-plan-limitations-401k-contribution-limit-remains-unchanged-at-18000-for-2017\">I.R.S<\/a>. income limitations, contribute to a Roth <a class=\"meta-classifier\" title=\"More articles about individual retirement accounts.\" href=\"http:\/\/topics.nytimes.com\/your-money\/retirement\/individual-retirement-account-iras\/index.html?inline=nyt-classifier\">I.R.A.<\/a> The adjusted gross income phaseout range for Roth I.R.A. contributions in 2017 is $186,000 to $196,000 for married couples filing jointly and $118,000 to $133,000 for singles and heads of households.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"238\" data-total-count=\"3105\"><strong>Review your credit report<\/strong><br \/>\nThe three credit bureaus \u2014 Experian, TransUnion and Equifax \u2014 provide one free report annually. Request one at <a href=\"http:\/\/www.annualcreditreport.com\/\">AnnualCreditReport.com<\/a>, and check it every year to avoid problems when you need access to credit.<\/p>\n<p id=\"story-continues-6\" class=\"story-body-text story-content\" data-para-count=\"344\" data-total-count=\"3449\"><strong>Do not<\/strong><strong> skip <a class=\"meta-classifier\" title=\"More articles about health insurance.\" href=\"http:\/\/topics.nytimes.com\/your-money\/insurance\/health-insurance\/index.html?inline=nyt-classifier\">health insurance<\/a><\/strong><br \/>\nCurrently, you can be insured as a dependent on your parent\u2019s health insurance plan until age 26 \u2014 unless you can get <a class=\"meta-classifier\" title=\"More articles about insurance.\" href=\"http:\/\/topics.nytimes.com\/your-money\/insurance\/index.html?inline=nyt-classifier\">insurance<\/a> through your job. If you cannot piggyback on your parent\u2019s plan and you do not have a job with health insurance, you may need to buy a policy through a health insurance marketplace.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"184\" data-total-count=\"3633\"><strong>Start an emergency fund <\/strong><br \/>\nSet aside money to cover unexpected life events and expenses like unreimbursed medical bills and auto or home repairs. Try to save a year\u2019s worth of expenses.<\/p>\n<h4 class=\"story-subheading story-content\" data-para-count=\"3\" data-total-count=\"3636\"><strong>40s<\/strong><\/h4>\n<p id=\"story-continues-7\" class=\"story-body-text story-content\" data-para-count=\"405\" data-total-count=\"4041\"><strong>Build a relationship with a financial adviser <\/strong><br \/>\nLook for a fee-only financial planner designated as a Certified Financial Planner by the nonprofit Certified Financial Planner Board of Standards. The Board of Standards, the National Association of Personal Financial Advisors and the Financial Planning Association all offer searchable databases with the contact information of certified financial planners.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"240\" data-total-count=\"4281\"><strong>Rebalance your retirement account regularly <\/strong><br \/>\nFinancial advisers typically suggest rebalancing your portfolio whenever the mix of equities and fixed-income investments is more than 7 percent to 10 percent from your original <a class=\"meta-classifier\" title=\"More articles about asset allocation.\" href=\"http:\/\/topics.nytimes.com\/your-money\/investments\/asset-allocation\/index.html?inline=nyt-classifier\">asset allocation<\/a>.<\/p>\n<div id=\"newsletter-promo\" class=\"newsletter-signup auto-newsletter\" data-newsletter-productcode=\"\" data-newsletter-producttitle=\"\">\n<p class=\"headline\"><strong>Make a personal retirement plan projection<\/strong><\/p>\n<form class=\"newsletter-form\" autocomplete=\"off\" method=\"post\" name=\"regilite\">\n<div id=\"captcha-container\" class=\"g-recaptcha\" data-sitekey=\"6LeN0R4TAAAAACwPa5WX2QYE0npOf2-2veTOm2Tp\">\u00a0A good place to start is an online calculator called the Ballpark E$timate, on the Employee Benefit Research Institute\u2019s site at <a href=\"http:\/\/choosetosave.org\/\" target=\"_blank\">choosetosave.org<\/a>. Many major mutual fund companies also have retirement calculators on their sites.<\/div>\n<\/form>\n<\/div>\n<p id=\"story-continues-8\" class=\"story-body-text story-content\" data-para-count=\"229\" data-total-count=\"4784\"><strong>Insure yourself <\/strong><br \/>\nIf you have children or other dependents, consider a term <a class=\"meta-classifier\" title=\"More articles about life insurance.\" href=\"http:\/\/topics.nytimes.com\/your-money\/insurance\/life-and-disability-insurance\/index.html?inline=nyt-classifier\">life insurance<\/a> policy that provides hundreds of thousands of dollars of coverage for minimum premiums over terms of 20 or 30 years, but has no cash value.<\/p>\n<p id=\"story-continues-9\" class=\"story-body-text story-content\" data-para-count=\"365\" data-total-count=\"5149\"><strong>Set <\/strong><strong>up a self-employed retirement plan<\/strong><br \/>\nIf you are starting a business, or moving to a nonprofit or a small firm without an employee retirement plan, keep setting aside money in tax-friendly accounts like a SEP-I.R.A., a solo 401(k) or a SIMPLE I.R.A. One of the biggest mistakes entrepreneurs make is not planning adequately \u2014 or at all \u2014 for their retirement.<\/p>\n<h4 class=\"story-subheading story-content\" data-para-count=\"3\" data-total-count=\"5152\"><strong>50s<\/strong><\/h4>\n<p class=\"story-body-text story-content\" data-para-count=\"110\" data-total-count=\"5262\"><strong>Pay down debts <\/strong><br \/>\nIf possible, pay off outstanding high-interest credit card debts, college loans and <a class=\"meta-classifier\" title=\"More articles about auto loans.\" href=\"http:\/\/topics.nytimes.com\/your-money\/loans\/auto-loans\/index.html?inline=nyt-classifier\">auto loans<\/a>.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"179\" data-total-count=\"5441\"><strong>Make your catch-up contributions<\/strong><br \/>\nIn 2017, workers 50 and older can contribute $6,000 in \u201ccatch-up\u201d contributions to their 401(k) or other employer-provided retirement plans.<\/p>\n<p id=\"story-continues-10\" class=\"story-body-text story-content\" data-para-count=\"468\" data-total-count=\"5909\"><strong>Review your <a class=\"meta-classifier\" title=\"More articles about Social Security.\" href=\"http:\/\/topics.nytimes.com\/top\/reference\/timestopics\/subjects\/s\/social_security_us\/index.html?inline=nyt-classifier\">Social Security<\/a> and pension benefit options <\/strong><br \/>\nYou can get an estimate of your future Social Security benefits and a record of your lifetime earnings history at <a href=\"http:\/\/www.socialsecurity.gov\/\">socialsecurity.gov<\/a>. The AARP also has a <a href=\"http:\/\/www.aarp.org\/work\/retirement-planning\/retirement_calculator.html\">retirement<\/a> and a Social Security benefits <a href=\"http:\/\/www.aarp.org\/work\/social-security\/social-security-benefits-calculator.html?intcmp=AE-RET-SOSC-SSBEN-SPOT3-SOCSEC-TM716\">calculator<\/a>. These days, many people claim Social Security as soon as they turn 62, the earliest possible age. If you delay claiming Social Security until age 70, you will increase benefits by about 8 percent a year.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"370\" data-total-count=\"6279\"><strong>Start planning your next act <\/strong><br \/>\nIf you want to start an encore career, keep in mind that money is the biggest stumbling block. That is because starting over in a new field, particularly a philanthropic one, or going the self-employment route, usually comes with a price tag, at least initially. Start planning a few years ahead by saving, adding new skills and downsizing.<\/p>\n<p id=\"story-continues-11\" class=\"story-body-text story-content\" data-para-count=\"335\" data-total-count=\"6614\"><strong>Make a move<br \/>\n<\/strong>Investigate the upside of moving to a smaller home, townhouse or condo. Depending on your real estate market, refinancing your mortgage can also lighten your debt load. Figure out how much you can save over time with an online refinancing calculator. Check <a href=\"http:\/\/hsh.com\/\" target=\"_blank\">HSH.com<\/a> or <a href=\"http:\/\/bankrate.com\/\" target=\"_blank\">Bankrate.com<\/a> for the latest rates and then shop around.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"407\" data-total-count=\"7021\"><strong>Protect the wealth you ha<\/strong><strong>ve<\/strong><br \/>\nReview disability, life, personal liability and umbrella insurance. Evaluate long-term care insurance coverage (generally not appropriate before or after mid-50s). Premiums get much larger as you age, and health issues may disqualify you. Update your will and <a class=\"meta-classifier\" title=\"More articles about estate planning.\" href=\"http:\/\/topics.nytimes.com\/your-money\/planning\/estate-planning\/index.html?inline=nyt-classifier\">estate planning<\/a> documents. Watch out for high mutual fund and management fees, which can whittle away at your savings.<\/p>\n<h4 class=\"story-subheading story-content\" data-para-count=\"16\" data-total-count=\"7037\"><strong>60s<\/strong> <strong>and B<\/strong><strong>eyond<\/strong><\/h4>\n<p id=\"story-continues-12\" class=\"story-body-text story-content\" data-para-count=\"267\" data-total-count=\"7304\"><strong>Get a grip on your retirement income sources <\/strong><br \/>\nCarefully review your anticipated income (Social Security benefits, pensions, distributions from personal investments and savings) and expenses (weekly, monthly and yearly budgets) at least a year before you stop working.<\/p>\n<p id=\"story-continues-13\" class=\"story-body-text story-content\" data-para-count=\"362\" data-total-count=\"7666\"><strong>Take control of fixed monthly costs<\/strong><br \/>\nDownsize. Consider selling your home and moving to an area with a lower cost of living or to a rental property. This will allow you to save on property taxes, maintenance and insurance costs. Some people who live in high cost-of-living areas might look at relocating to an area with lower taxes and cheaper real estate costs.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"279\" data-total-count=\"7945\"><strong>Consider working beyond your official retirement age <\/strong><br \/>\nThe longer you work, the longer you can contribute to a defined contribution plan like a 401(k). Working longer might give you access to a health plan, or help you pay for another one until you are eligible for <a class=\"meta-classifier\" title=\"Recent and archival health news about Medicare.\" href=\"http:\/\/topics.nytimes.com\/top\/news\/health\/diseasesconditionsandhealthtopics\/medicare\/index.html?inline=nyt-classifier\">Medicare<\/a> at 65.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"160\" data-total-count=\"8105\"><strong>Shift your investments to a more conservative asset mix<\/strong><br \/>\nYou may want to keep about 40 percent of your investments in stocks or stock funds well into retirement.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"330\" data-total-count=\"8435\" data-node-uid=\"1\"><strong>Plan your withdrawal rates <\/strong><br \/>\nA conservative annual drawdown of retirement savings may be to take 3 percent the first year, and to adjust for inflation after that. If you have saved $1 million, for example, plan to withdraw $30,000 in the first year and to increase that amount by the rate of inflation in the second year and beyond.<\/p>\n<p class=\"story-body-text story-content\" data-para-count=\"330\" data-total-count=\"8435\" data-node-uid=\"1\"><strong><span class=\"byline\">By<a href=\"https:\/\/kerryhannon.com\"> <span class=\"byline-author\" data-byline-name=\"KERRY HANNON\">KERRY HANNON\u00a0<\/span><\/a><\/span><\/strong><\/p>\n<footer class=\"story-footer story-content\">\n<div class=\"story-meta\">\n<p class=\"story-print-citation\">A version of this article appears in print on March 5, 2017, on Page F5 of the New York edition with the headline: What to Do Now. <span class=\"story-footer-links\"><a href=\"http:\/\/www.nytreprints.com\/\" target=\"_blank\">Order Reprints<\/a><span class=\"pipe\">|<\/span> <a href=\"http:\/\/www.nytimes.com\/pages\/todayspaper\/index.html\" target=\"_blank\">Today&#8217;s Paper<\/a><span class=\"pipe\">|<\/span><a href=\"http:\/\/www.nytimes.com\/subscriptions\/Multiproduct\/lp839RF.html?campaignId=48JQY\" target=\"_blank\">Subscribe<\/a><\/span><\/p>\n<\/div>\n<\/footer>\n<\/div>\n<\/div>\n<div style=\"padding-bottom:20px; padding-top:10px;\" class=\"hupso-share-buttons\"><!-- Hupso Share Buttons - http:\/\/www.hupso.com\/share\/ --><a class=\"hupso_toolbar\" href=\"http:\/\/www.hupso.com\/share\/\"><img data-recalc-dims=\"1\" decoding=\"async\" src=\"https:\/\/i0.wp.com\/static.hupso.com\/share\/buttons\/share-small.png?w=640&#038;ssl=1\" style=\"border:0px; padding-top:5px; float:left;\" alt=\"Share Button\"\/><\/a><script type=\"text\/javascript\">var hupso_services_t=new Array(\"Twitter\",\"Facebook\",\"Google Plus\",\"Pinterest\",\"Linkedin\",\"StumbleUpon\",\"Digg\",\"Reddit\",\"Bebo\",\"Delicious\");var hupso_background_t=\"#EAF4FF\";var hupso_border_t=\"#66CCFF\";var hupso_toolbar_size_t=\"small\";var hupso_image_folder_url = \"\";var hupso_url_t=\"\";var hupso_title_t=\"Best Moves Now to Retire Better\";<\/script><script type=\"text\/javascript\" src=\"https:\/\/static.hupso.com\/share\/js\/share_toolbar.js\"><\/script><!-- Hupso Share Buttons --><\/div>","protected":false},"excerpt":{"rendered":"<p>\u00a0Here are steps to get your financial situation in shape, whether you are closing in on retirement or just starting out. 20s and 30s Learn the money basics Two books to consider: \u201cHow to Think About Money,\u201d by Jonathan Clements, and \u201cHeads I Win, Tails I Win: Why Smart Investors Fail and How to Tilt [&hellip;]<\/p>\n<div style=\"padding-bottom:20px; 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