Pensions - What Should I Do ?

tess asked:


I will be travelling there in August, if you have been, which would you recommend and which to avoid?

Gianna

Vince Shorb asked:


Have fun and retire young is the mantra of many high school and college students today. Unfortunately, only a minority of them will be able live their dream life.

Social Security and pensions probably won’t be around when your teenager reaches retirement age. In the last ten years we’ve experienced a large reduction in pension plans offered to employees. Employers are replacing pension plans with contributory retirement programs. Unfortunately, according to a report of the National Association of State Boards of Education, “most workers with access to these contributory programs are not participating sufficiently to allow them to retire in their sixties without suffering a great decrease in their standard of living.”

This may mean that everyone under age 30 will need to self-fund their own retirement. In order to be financially prepared, it is important they start investing young and avoid financial pitfalls that plague many of their peers. This requires they learn the basic financial education skills so they are financially prepared.

To be financially prepared for retirements today’s youth will need to have over a million dollars to be fully financially prepared for a self-funded retirement. After calculating the long-term inflation rate, a young adult today will need over a million dollars in order to retire on an annual income of around $35,000 (today’s dollars, adjusted for inflation and salary increases). This is assuming that they live to be ninety years old. However, with the improvements in medicine, many experts feel we will live beyond that mark, so just planning to live to 90 may not be enough. And $35,000 annual income per year is not a lot of money to enjoy the golden years.

What’s the answer? One answer may be a simple investment of $100 per month starting at age 18. If that investment earns a return similar to the S&P 500 average over the past 82 years, they would have over a million dollars many years before they reach retirement age.

Have fun and retire young by following these simple steps.

1) Invest Young -There are powerful financial forces on your side when you start investing young. One of the most beneficial to young investors is compounding interest.

Compounding interest occurs when you invest money and earn a return on what you invest. The amount your investment returns then starts to earn you money. This forms a snowball affect that will make your money grow bigger the longer you are invested.

To break it down, you’re making money off the interest your investment already paid you. Then you continue to make money off the interest that you made each year. That means year after year your investments can grow at a faster and faster pace.

2) Consistent, young, investment plan. Investing on a consistent basis may allow you to generate long-term gains over time. For most, simplicity equals consistency; and consistency over time leads to financial security. Follow a consistent investment plan immediately; then as your investment knowledge grows you can add other forms of potential higher-return investments.

3) Use investment vehicles that offer tax benefits -Roth IRA may allow you to withdraw money at retirement tax-free. Many people don’t realize about 40% of your income goes to pay taxes. You will keep more of the money you earn by investing in an IRA.

Diversification - For young investors the stock market can be a great place to start investing. As your account size grows you could take some of that money and move it into real estate or business ventures.

Diversification lowers risk. For example, if you have ‘all’ your money invested in the stock market when prices are declining then ‘all’ your money may decline in value as well. Now if you diversify your holdings and had a portion of your money invested in the stock market, some in the real estate market and some in businesses you might avoid a big loss.

The thought of funding one’s own retirement makes some people nervous but if people start young and stay consistent, today’s generation will be able to afford the lifestyle they want now and through out their life.



Paige

watershed_22 asked:


Trying to e-file for my parents.The only income they had was money that came from my grandfathers death.He had some money in his pensions/annuities.My father recieved a 1099r form that documents this,how can I efile for free using this form,I don’t have a W-2 or 1040 form since both of my parents were unemployed at the time.

Tristan

Candy J asked:


I received an email today that stated that most of the changes that have caused the downfall of the social security system were done by democra tic presidents.

Sean

Seeker1898 asked:


Hi all! I’m planning on becoming a police officer and I’m already in the process of really researching the career out from top to bottom. Are police officer pensions and benefits great after 25 years of service? In general, in today’s dollars and excluding future inflation, could I expect to get at least $2,500 per month after retirement in net pay plus great health and other benefits? Any answers would be greatly appreciated. Thanks!

Caroline

hannah_spanner_x asked:


Whats the idea behind them, how does the process work?
Why is it considered one of the best policies in europe? Are there any problems that the new pension system has created?

Kayla

Anthony Woods asked:


Pension’s Tips: It is said that people either “live too long or die too young”, and nowhere is this more typified than in the Construction Industry, where up to recently, both the safety record and the Pension planning record had been nothing short of appalling.

On the one hand, the fatality and injury record of workers in the Irish Building Industry was one of the highest in Europe (in 2001, 28% of all workplace fatalities were Construction Industry related), while those who were lucky enough to have survived working on Irish Construction sites faced a very uncertain future as they neared retirement.

While the authorities have made some strides in addressing the Construction Industries safety record in the recent past, there is still considerable scope for improvement with regard to adequate and proactive Pension Planning (in an IAPF survey dated October ,2005,it was found that nearly the entire Irish population was dependant on the state pension)While a recent IMPACT Trade Union report found that in Ireland, there are currently 5 people of working age for every person aged over 65, but that figure will fall to 2 to 1 by 2050,causing a huge funding crisis.

The lack of Pension planning is a symptom of a larger Irish malaise, namely their totally reactive nature to nearly everything. This especially applies to Construction Industry Pensions, where despite extensive publicity on the need for adequate Pension planning, the Pension expertise available and the negative effects of no Pensions being in place at retirement, excuses still abound for doing nothing. In an effort to be seen to do something, the Government is even rumored to being looking at making Pension funding compulsory.

In over 25 years of Pensions planning, here are the 7 most popular excuses I’ve come across in the Construction Industry for not planning a Pension.

* I can’t afford it

* I’m too young/old

* “Someone else” will provide for it

* I’ll do it “later”

* There’s a state pension

* I don’t want to think about it

* I’ll be dead by then

I can’t afford it — expansive pension ……ask yourself can you afford NOT to? Waiting until you can afford it will never happen. The minimum monthly premium for a self employed Pension is €25 gross, or with tax relief at 20%, €20per month ……that’s €1.00 per day. Given that the minimum Lottery ticket price is €1.50 per go, and there are absolutely no guarantees whatsoever with that, €1 is a small price to pay for securing your future and security of mind, isn’t it?

Insurance go first! I’m too young/old ….you’re never too young, or old for that matter, to start to proactively secure YOUR future. The earlier you start, the longer your funds have to grow and appreciate in value, while even starting much later in life will give you tax relief and help you to exercise SOME power over your finances.

A plan for my Pension? “Someone else” will provide it …………who, precisely? And why should they? While an employer may contribute to your Pension Plan, ask yourself how much of a benefit you’d expect to get, would it be guaranteed, and if so, for how long? Would you be happy to have “someone else” pick your clothes, choose your car or have any other say in your life - but if you don’t plan for your Pension, “someone else” WILL be deciding your future.

I’ll do it “Later …… look at the cost of delay - to provide a pension of €2,000 per month, a 20 year old would need to pay €270 per month into a pension plan, while a 40 year old saving for EXACTLY the same amount would need to pay €951 per month - FRIGHTENING, isn’t it??

There’s a State Pension …….there is alright. As of Jan, 2007, that stands at the princely sum of €209.30 per week. Now ask yourself, given the ever increasing cost of accommodation, transport, food, communications, entertainment etc., if you were relying on the State Pension ONLY, would you be LIVING or EXISTING?

I don’t want to think about it…….fair enough, that’s your prerogative, but burying your head in the sand on the Construction site won’t make planning for your future go away. Can you imagine a Builder deciding they didn’t want to think about something on a Construction site……would you be happy to work there?

I’ll be dead by then …perhaps you will, but suppose you’re not? Can you imagine HAVING to continue doing manual labor out of dire economic necessity? Or what if you’ve worked all your life and in spite of your best efforts, face 30 years of retirement?

Another alternative the Irish Government are looking at, as pointed out in a recent IBEC report in Feb 2006, is that they may increase the minimum retirement age to 70 or 75.Can you imagine the potential effect this would have on the Construction Industry? So, as an Irish Building worker, why don’t you take control of your future, ignore the 7 most popular excuses outlined above, and make your Pension THE KEYSTONE of your financial future……and if you need another incentive, try living on €209.30, and nothing else, for a few weeks!!!

For general pension’s information, please visit the website of the Irish Pensions Board or for Information relating specifically to Pensions visit Irish Construction Industry Pensions.

Ireland’s premier supplier of Pension and Retirement planning for those contractors, suppliers and sub-contractors who work in the Irish Construction Industry



Paige

B D asked:


With Lehman Bros. filing for chapter 11, what happens to retireee pensions and medical benefits? Will they just cease, will they be restructured, will they be untouched?

Any info would be very helpful, Thank you.

Emelia

Demitrius S asked:


I was terminated a while back, and I’m not sure about how pensions really work. I am 33 and I received a letter from my former employer saying I had a vested value of 9K. Can I withdraw that money now?

Aiden

w s asked:


please help me! can you give me more than one reason!

William