Retirement PLANning

[Jeepman]

Heres what you do:

1. Put only up to the company match into the 401(k)

2. Max out your Roth and if you can max it out, put whatever is left over into the 401(k)

3. Buy books on money such as : Rich Dad Poor Dad, Smart couples finish rich (David Bach), Real Money-sane investing in an insane world (Jim Cramer), and Beating the street.

If you do decide to invest on your own in stocks (which I recommend) and you don't know what to invest in go to www.thestreet.com. And do your homework!

 

[PacoPollo]

Buy bunch of Independence shares..Right now at .19 cents Buy while its cheap..!!!!

 

[DwayneWorthless]

Retirement issues

Once ALPA convinces Congress to support the "Pension Relief Act" and bails out the Mainline Guys. We'll consider throwing some scraps towards you little Regional Guys. Don't worry, we will take care of you. Don't forget to pay your DUES.

 

[atlcrashpad]

Retirement

I maxed out my 401K, invested in CD's, and started a Roth IRA. You've got to look out for your retirement. I don't believe company funded retirements are going to going to be around much longer. Invest in your future, because no one else will.

 

[jrav8tor]

"So, let's look at the Roth IRA. My contributions are after taxes -- that means that I'm paying taxes on my contribution NOW, while I'm in the 17% bracket. Later on, when I'm in the 50% bracket, I pay nothing on my withdrawls."

"The principal of the Roth can be withdrawn at any time with no tax consequence."


I know you probably know this already and decided to not get too detailed, but to those uniformed on Roth IRA's, you will pay taxes on any earnings earned on your contributions that are considered after-tax.

IMO, Rottie has provided some good basic advice and from my own experience in the financial services industry I agree with 100% of what he has said.

 

[jrav8tor]

Ok, I haven't figured out how to get the quote in the blue box?

 

[Rottie]

How is it better in a Roth IRA...given that it is after-tax dollars? Most guidance I have seen says to max out your 401k first...then max out a Roth if you can afford it.

-Neal

401K and Trad IRA's grow tax deferred, ROTH IRA's grow tax free. No you can't use the roth ira's as a tax deduction, but unless you are making six figures, it isnt worth it. Money growing tax free is better than tax deferred, and in the end you will pay less taxes. 401k's should be contributed til the match is maxed, then an ira, preferably a roth.

 

[Rottie]

Here is what it all comes down to guys...Look out for number one. Companies are not going to give you any more money than they have to. Profit sharing is more beneficial to the company than the employee, when looking at different compensation methods. 401k's are good, even better is if/when your company rolls out a ROTH 401k's, and I suggest pushing them, they are a HUGE benefit for you. You used to be able to count on the gov't (social security), your company (pension), and whatever you saved for retirement. The only variable in that thing you control is you. Making smart choices about your money isn't easy, and there are tons of books out there to tell ya how to do it. Just look out for numbero uno and you will do ok.

 

[Draginass]

Ya gotta do what the execs do . . . . get "yours" upfront and under your control, as much as possible, as soon as possible, and legally free from BK lien, and to hell with the company you work for. Remember, GET YOURS, screw everybody else, and move on once the trough dries up. That's the American way of business now.

However, in this profession the way it's going, you're not going to be able to retire, so why bother saving. Given the life expectancy of pilots and the probability of your ex-wife getting most of your retirement, that's another good reason to spend your money on liquor and women now while you're young enough to enjoy them.

 

[AZ Typed]

Well - for pilots I think we have some GREAT advice on this thread for retirement planning. I especially agree with the response talking about letting the professionals manage your money (i.e. mutual funds). I don't change my oil because I don't know how (pathetic, I know). Accordingly, I don't pick my own stocks because I don't have the time or energy to look at the thousands and thousands of stocks available and risk my money in such a segregated market section. I also agree with the 401(k) contribution, then IRA, then taxable mutual funds. Of course, don't forget to build an emergency / strike fund and have a debt reduction plan. For the poster who said moving to Scottsdale at 60 to play golf ins't possible anymore - why not Mr. Chicken Little? This is America...you can do whatever you want. A dual income household making $70-ish K (reasonable income for dual income house) can pack at least 10% away and make over $1,500,000 by retirement at 60. Even indexed for inflation, one can leave the full time workforce at that point and play golf in Scottsdale. If you have a 401(k) - at least contribute the match. Unfortunately, I don't have one so my ROTH is maxed out and it did 13% last year. My wife's did 17%. Meanwhile individual stock pickers and those who watch too much TV think the stock market is not a good investment and dump their money into rental real estate that costs them each month while income is tight. Also, don't forget about adequate life & disability insurance, especially if you have a family. FAR 135 and 121 pilots can get preferred plus rates (I know because I have that rate on myself). AOPA and union life insurance is typically a rip off (most group plans are rip offs). Finally, hire a professional. Their are LOTS of professoinals out there who can help with financial planning and they don't charge a fee for their service. Remember, what you do with your money is ultimately up to you...so seek guidance and advice from a professional!