Excerpt from recent AARP Article with Financial Guru Susie Orman.1

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Interested in learning more about retirement income through annuities? Please contact me and I will clearly explain what options are available. Please share with your family and friends. Contact me with any questions or concerns.

As always, plan wisely my friends,

Finding a reputable and trusted partner to assist you with your social security, Medicare, financial & insurance needs is of vital importance.  I will work hard to find the best programs, coverage and rates that fits your budget and your needs. Contact me at 949-216-8459 or [email protected]

Click here for other articles about Annuities 

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Information and materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice. The above information is not intended to provide, and should not be relied on for, tax, legal, accounting or investment advice.
Coliday / Craig Colley is not giving any financial , tax or legal advice, is not a financial advisor and is not affiliated, employed or endorsed by the SSA, Medicare.gov. or any other government agency.

 source: Ihttps://www.aarp.org/retirement/planning-for-retirement/info-2020/suze-orman-10-steps-to-your-future.html

The post Buy Some Guaranteed Income appeared first on Coliday HealthCare Services.

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Interested in learning more about retirement income through annuities? Please contact me and I will clearly explain what options are available. FYI: remember you do not need to have a 401k to have a tax deferred annuity. Please share with your family and friends. Contact me with any questions or concerns.

As always, plan wisely my friends,

Finding a reputable and trusted partner to assist you with your social security, Medicare, financial & insurance needs is of vital importance.  I will work hard to find the best programs, coverage and rates that fits your budget and your needs. Contact me at 949-216-8459 or [email protected]

Click here for other articles about Annuities 

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Information and materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice. The above information is not intended to provide, and should not be relied on for, tax, legal, accounting or investment advice.
Coliday / Craig Colley is not giving any financial , tax or legal advice, is not a financial advisor and is not affiliated, employed or endorsed by the SSA, Medicare.gov. or any other government agency.

1 Various reference sources: Investment News, USA today, Yahoo Financial

The post Is the Coronavirus infecting your money? appeared first on Coliday HealthCare Services.

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Interested in learning more about retirement income through annuities? Please contact me and I will clearly explain what options are available. FYI: remember you do not need to have a 401k to have a tax deferred annuity. Please share with your family and friends. Contact me with any questions or concerns.

As always, plan wisely my friends,

Finding a reputable and trusted partner to assist you with your social security, Medicare, financial & insurance needs is of vital importance.  I will work hard to find the best programs, coverage and rates that fits your budget and your needs. Contact me at 949-216-8459 or [email protected]

Click here for other articles about Annuities 

Share0

Share +10

Tweet0

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Information and materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice. The above information is not intended to provide, and should not be relied on for, tax, legal, accounting or investment advice.
Coliday / Craig Colley is not giving any financial , tax or legal advice, is not a financial advisor and is not affiliated, employed or endorsed by the SSA, Medicare.gov. or any other government agency.

1 Various reference sources: Investment News, USA today, Yahoo Financial

The post Annuities are coming to 401(k)s appeared first on Coliday HealthCare Services.

Being early can be considered a virtue. Just think of some of the proverbs that we’ve all heard hundreds of times over the years: 

“The early bird gets the worm.”

“Early to bed and early to rise makes a man healthy, wealthy and wise.”

There are many situations where being early can be a good thing. But when it comes to retirement, going too early can actually have drawbacks. That’s certainly not the case for everyone, but you’ll want to carefully evaluate your situation before you make any decisions.

Early retirement can be an intriguing prospect for many people. No more 40-hour work weeks. No more setting the alarm clock every morning. You might even finally have time to chase those “someday” plans and dreams. But the challenges are addressed in a recent article from The Motley Fool, “3 Downsides to Early Retirement¹.”

The first downside in the article deals with your retirement savings. Retirement itself can be expensive. If you want to retire early, it becomes even more so. You’ll need to save more because you’ll have more retirement years to cover financially. And you’ll have less time to save that money. How will you determine how much you should be saving?

You may want to start by creating a retirement budget. This would entail weighing your current and potential expenses. Working with your financial services professional can help you determine an estimate of your monthly expenses and what you’d need to save now to be prepared for your early retirement date.

For many retirees, healthcare is likely to be a major expense. When you combine Medicare premiums, Medicare gap coverage, long-term-care insurance, prescriptions and more, healthcare can become a large part of your budget. To reach an estimate of your monthly costs, you can add up the costs you already know, like fixed monthly costs of premiums and other anticipated amounts. Depending on your individual situation, you may consider increasing your monthly contributions to a Health Savings Account if you have years left before you retire.

But that leads us to the second early retirement drawback: You won’t have access to Medicare until age 65. This means that any healthcare costs that you incur before you turn 65 will need to be accounted for as well.

The third and final drawback is that part of your income in retirement is likely going to come from Social Security. But you can’t get that portion until you’re 62, at the very earliest. So, if you plan on retiring before 62, you’re going to need to rely on your personal savings for your monthly income. Also, if you decide to claim at age 62, you’ll lose out on a potentially higher benefit. Filing for your Social Security benefits at your full retirement age is the only way to ensure you get your full Social Security benefit.

Retiring early may be your dream. But to make that dream a reality you’re going to have to address these challenges and more. You will need to save more money in less time. Find a way to cover your healthcare costs before Medicare is an option. And you’ll have to determine your monthly income before Social Security can be used as a supplement to your savings.

Early retirement is not impossible. But it takes a thorough strategy.

Ask how we can help you begin to address these challenges.

The post 3 Drawbacks to Early Retirement appeared first on Coliday HealthCare Services.

It’s hard enough to prepare for retirement when you’re working with correct information. Factor in the misconceptions that are out there, and it can feel downright impossible. 

That seems like a good reason to try to cut through some of the misconceptions. The Motley Fool investigated three examples in its October 2019 article, “3 Money Myths That Could Ruin Your Retirement.”¹

The author, personal finance and retirement writer Katie Brockman, breaks down each of these things that she considers myths and how they can impact  your retirement. “Myth” is a strong word, and “misconception” might be a little more accurate since each comes from some factual basis, but the end assumption is flawed in some way.

Take, for instance, the first misconception: The idea that you will spend less in retirement. According to the article, it’s likely that spending will change during retirement for most people. But it just might not be different in the way you’re expecting. The article cites a report from J.P. Morgan that showed nearly 80% of retirees experienced a significant change in their spending, but more than a third of them found themselves spending more than they had before retirement during at least some retirement years. For many of the survey respondents, the years they spent the most often came early in retirement.

You can imagine the challenge that would come with suddenly spending more than expected! So, this misconception could be expensive. You may average less spending per year over the course of your retirement, but that average may include years of more spending.

Another misconception from the article is that if you wait until you have a higher income, it will be easier to save for retirement. At first blush, it’s easy to rationalize this idea. Making more money would mean there’s more money to save. However, building a retirement nest egg can take years. If you put off saving for retirement you may find yourself needing to save an even larger percentage of your income. Missing out on years of potential annual rate of return can result in challenges later in life. Saving early, even if it’s a small amount, can have strong financial results.

The final misconception in the article deals with Social Security. In the article, they caution against assuming Social Security benefits can be your primary source of retirement income. According another Motley Fool article, “The Average Social Security Benefit Is Probably Smaller Than You Think²,” in 2019 the average Social Security check was just over $1,400. For many people, that’s likely not enough to cover all your monthly expenses. When you look at the potential growth of medical expenses in the future, you may feel even less enthusiastic about covering your costs with Social Security benefits alone.

What will be important is for you to maximize your Social Security income when the time comes. Working with a financial services professional can help you determine the right time and strategy for your personal financial situation.

Social Security, monthly expenses and delaying savings can all have a large impact on your financial future. Misconceptions, myths and incorrect assumptions about these issues can further cloud your vision of the future. By ruling out the information that isn’t helpful, you give yourself an easier path to retirement and make decisions that can help you realize your retirement goals.

The post Misconceptions That Could Derail Your Retirement appeared first on Coliday HealthCare Services.

What Is the SECURE ACT?

The Secure Act was signed into law December 20, 2019, and became effective January 1, 2020. The new law changed required minimum distributions (RMDs), contribution rules, college planning opportunities and many more. The most devastating issue for savers is the elimination of the stretch concept for your beneficiaries.

SECURE ACT HIGHLIGHTS

• Makes it easier for small businesses to offer their employees 401(k)s by providing tax credits and protections on collective multiple employer plans

• Allowing retirement benefits for long-term, part-time employees

• Removing maximum age limits (formerly 70 ½ ) on retirement contributions

• Raising the required minimum distribution (RMD) age to 72 from 70 ½

• Allowing penalty-free withdrawals of up to $10,000 from 529 education-savings for the repayment of certain student loans

• Revising components of the Tax Cuts and Jobs Act that raised taxes on benefits received by family members of deceased veterans, students and some Native Americans

Read on for a look at how the SECURE Act could affect your retirement planning.

The post The Secure Act of 2020 appeared first on Coliday HealthCare Services.

More People Are Saving For Retirement, But Many Still Aren’t

​More people are saving more money for retirement than they have in the past few decades, according to a recent report from the U.S. Government Office.¹ That’s great news!

Now for the not so great news. The report, titled “Retirement Security: Income and Wealth Disparities Continue through Old Age,” found that there’s still a lot of ground to cover to get retirement savings where they may need to be.

The report found that 30 years ago, in 1989, about 4% of low-income households and up to 65% of high-income households had set aside money in a retirement account. Those percentages increased to 11% and 86% of households, respectively, in 2016.

The report largely credits that increase in the number of people who are saving to more employers offering defined contribution plans. These include the tax-code-numbered plans that you are likely familiar with, like 401(k)s and 403(b)s. Another process that gets credit for the increase, according to the report, is that more employers are automatically enrolling their employees in their employer-sponsored defined contribution plan.

In 2018, Vanguard reported that 48% of their plans had an automatic enrollment option​². In many cases, automatic enrollment applied to new hires only at first, but many plans have been expanded to include existing employees. This helps frame the decision to enroll for the employee as an opt-out rather than an opt-in.

And it’s not just that more people are saving. More people are saving more. That’s thanks in part to the fact that enrollment is not the only automatic feature of many employer-sponsored defined contribution plans. Most of these plans — 66% — also have automatic annual deferral rate increases​².

These increases in contributions can help employees automatically adjust for potential inflation and save just a bit more each year.

While these are encouraging statistics, the number of low-income households that are saving for retirement have not returned to levels seen before the 2007-to-2009 recession. In 2007, 16% of households in the low-income category had some kind of retirement account.1

Among those retirement accounts, the defined contribution plan reigns supreme in terms of usage. According to The Vanguard Group’s “How America Saves 2019: The Retirement Savings Behavior of 5 Million Participants,”​² more than 100 million Americans are covered by defined contribution plan accounts.

Even with that many individuals participating, the report cites that a significant amount of those who are eligible for these types of plans fail to participate. Those who decline to participate are missing out on another potentially valuable opportunity: employer matching contributions. A third of all plans provided both matching and nonmatching employer contributions​². These contributions can help increase the balance of a retirement account.

So, the good news is that more Americans are opening retirement savings accounts. If you’re one of them, you are doing the right thing to help prepare to have income in retirement.

If you’re not, there’s still time. If you have access to a defined contribution plan that you aren’t utilizing, it’s better to put something away than nothing. And that’s only one option of many that can help you prepare for retirement.

Contact me today to get started on a strategy that can help take you to retirement and beyond.

The post More People Are Saving For Retirement, But Many Still Aren’t appeared first on Coliday HealthCare Services.

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How Much Cash Should I Keep in the Bank?

Article from Tim Parker, Financial journalist clearly explains what the majority of Americans might not know about how much they should have available for emergencies.

Written by Tim Parker| Tuesday, October 10, 2018
Everybody has an opinion on how much money you should tuck away in your bank account. The truth is, it depends on your financial situation. What you need to keep in the bank is the money for your regular bills, your discretionary spending and the portion of your savings that constitutes your emergency fund.

Everything starts with your budget. If you don’t budget correctly, you may not have anything to keep in your bank account. Don't have a budget? Now’s the time to build one. Here are some thoughts on how to do it.

The 50/30/20 Rule
First, let’s look at the ever-popular 50/30/20 rule. Instead of trying to follow a complicated, crazy-number-of-lines budget, you can think of your money as sitting in three buckets.

Costs that Don’t Change (Fixed): 50%
It would be nice if you didn’t have monthly bills, but the electricity bill cometh, just like the water, Internet, car, and mortgage (or rent) bills. Assuming you’ve evaluated how these costs fit into your budget and decided they are musts, there’s not much you can do other than pay them.

Fixed costs should eat up around 50% of your monthly budget.

Discretionary Money: 30%
This is the bucket where anything (within reason) goes. It’s your money to use on wants instead of needs.

Interestingly, most planners include food in this bucket because there’s so much choice in how you handle this expense: You could eat at a restaurant or eat at home; you could buy generic or name brand, or you could purchase a cheap can of soup or a bunch of organic ingredients and make your own.

This bucket also includes a movie, buying a new tablet or contributing to charity. You decide. The general rule is 30% of your income, but many financial gurus will argue that 30% is much too high.

Financial Goals: 20%
If you’re not aggressively saving for the future – maybe funding an IRA, a 529 plan if you have kids, and, of course, contributing to a 401(k)or another retirement plan, if possible – you’re setting yourself up for hard times ahead. This is where the final 20% of your monthly income should go. If you don't have an emergency fund (see below), most of this 20% should go first to creating one.

Another Budget Strategy
Financial guru Dave Ramsey has a different take on how you should carve up your cash. His recommended allocations look something like this (expressed as a percentage of your take-home pay):

Charitable Giving: 10%-15%
Food: 5%-15%
Savings: 10%-15%
Clothing: 2%-7%
Housing: 25%-35%
Transportation: 10%-15%
Utilities: 5%-10%
Medical/Health: 5%-10% 

About That Emergency Fund
Beyond your monthly living expenses and discretionary money, the major portion of the cash reserves in your bank account should consist of your emergency fund. The money for that fund should come from the portion of your budget devoted to savings – whether it's from the 20% of 50/30/20 or from Ramsey's 10% to 15%.

How much do you need? 
Everybody has a different opinion. Most financial experts end up suggesting you need a cash stash equal to six months of expenses: If you need $5,000 to survive every month, save $30,000.

Personal finance guru Suze Orman advises an eight-month emergency fund because that’s about how long it takes the average person to find a job. Other experts say three months, while some say none at all if you have little debt, already have a lot of money saved in liquid investments, and have quality insurance. 

Should that fund really be in the bank? Some of those same experts will advise you to keep your five-figure emergency fund in an investment account with relatively safe allocations to earn more than the paltry interest you will receive in a savings account.

The main issue is that the money is instantly accessible if you need it. (On the other side, remember that money in a bank account is FDIC insured.) For more advice, read more about building an emergency fund.

If you don’t have an emergency fund, you should probably create one before putting your financial goals/savings money toward retirement or other goals. Aim for building the fund to three months of expenses, then splitting your savings between a savings account and investments until you have six to eight months worth tucked away.

After that, your savings should go into retirement and other goals – invested in something that earns more than a bank account.

The Bottom Line
The most recent Federal Reserve data from the “Report on the Economic Well-Being of U.S. Households in 2015” surveyed Americans and mentioned that “Forty-six percent of adults say they either could not cover an emergency expense costing $400, or would cover it by selling something or borrowing money.”

That doesn’t leave much room for saving.

Most financial gurus would probably agree that if you start saving something, that’s a great first step. Plan to raise that amount over time. 1

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I am in a business that seems to have fallen into the same undesirable, necessary evil, distasteful category as the TSA, lawyers, dentists and the DMV... that is until you need them.

It must be true because so many people in my industry are coming up with names and descriptions to disguise and re-label it from what it actually is. For example, concepts and strategies for growth and preservation of wealth, huh? What is that supposed to mean? Or strategies to address life planning challenges, what?

In this case, I'm going to call the kettle black. As a licensed insurance agent I offer financial services and sell insurance. According to various industry reports and experts, you can't lead with it because it turns people off. Well, I never thought finance and insurance was attractive enough to turn someone on. Most people know they need it just as much as other services I've previously mentioned. Without it, you and others you care about will definitely know what life planning challenges are when a crisis, accident, critical illness or death occurs.

Most of us know someone who's gone through a loss or tragic experience and usually our first question is, did they have insurance? Second question; why didn't they have insurance? Third question; what were they thinking? Fourth question; if I was in that same situation do I have adequate coverage? And a final comment, if they had only spent a little money on an insurance policy, they could have saved themselves from a lot of additional pain, trouble and financial hardship.

So, go ahead and call the kettle black.

When you're ready to say I need help with insurance and a financial plan for retirement please give me a call.

Craig Colley
(949) 216-8459
CA Lic. #0I48609

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