Are you financially prepared for retirement? Here's a quick quiz that can tell you a lot.
Do you know if you will have enough money in retirement? Here is a little pop quiz of yes or no questions you should ask yourself:
1. Is all of your retirement money in mutual funds and/or stocks? Yes or no?
2. Will all of your retirement money be taxed as income? Yes or no?
3. Is all or most of your retirement money in a 401(k) or similar plan? Yes or no?
4. Will you be footing the bill for your child’s college education? Yes or no?
5. Are you saving less than 10% of your income outside of your employer’s 401(k) plan? Yes or no?
If you answered yes to any one of these questions, there is a huge hole in your retirement plan. If you answered yes to two or more of these questions, you’re at a very high risk of running out of money in retirement.
You can significantly lower and/or completely eliminate your risk of running out of money in retirement if you follow these steps:
1. Start a retirement plan using a cash value life insurance policy with 10 to 20% of your after-tax income. This would be in addition to whatever retirement plans you have at work.
2. Start preparing your child to get merit award money from colleges. This can begin as early as the eighth grade; the earlier you start the better. For help contact POWT.org. They are a 501(c)3 nonprofit organization that helps families prepare their children to get merit award money from colleges.
These two little steps will make all the difference in the world in your financial future. The biggest problem most people will have is procrastination. The best thing that you can do for yourself right now is to decide to do something today and get started. By starting today you overcome procrastination, and the biggest benefit is the earlier you start, the more money will have later on.
Absolutely, make sure you come back here next week to Physician’s Money Digest for another edition of The Alemian File.