Asked by Henry  |  Submitted July 06, 2015

What is the best way to save for retirement?

Are employer 401(k)'s still the best alternative or should I use IRA's or other tax saving products?

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  Answers  |  6

July 07, 2015

I like annuities and life insurance. 401k's and IRA's can be a good investment but to be honest there's too many hidden fees in those products. In today's economy in retirement we will need every dollar we can get to take care of our families. Life insurance and annuities are not all alike but the famous one we have designed for now and the future is ( Grandfathered ) in the law for guaranteed % each years and with strategies that your consultant can lead you to the money you use now will be tax free guaranteed contracts are awesome. And not to mention if you need long term care the policy will cover this also. Good investment.

$commenter.renderDisplayableName() | 05.24.17 @ 21:55

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July 08, 2015

It's all based on your life situation. IRA's, Annuities, Insurance products may all be right for you, but it is difficult to know that without having a financial strategy. The best thing you can do for yourself is consult with a financial professional who can understand your current financial situation and create an appropriate strategy to help you make the best and most informed decision. Ultimately, each program has a benefit, but it's your decision to make, and you should do it with knowledge and information that can be provided by a professional.

Feel free to contact me if you have any questions.

$commenter.renderDisplayableName() | 05.24.17 @ 21:55

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July 08, 2015

Hi Henry - in agreement with Rafael, how you save for retirement will ultimately depend on your short-term, immediate, and long-term goals. Too often, most people will simply contribute to their current employer's 401(k) without having a plan and without understanding if this one retirement account will even serve their future needs. Then, they get to retirement only to find out that what they've saved is simply not enough. Think of retirement as a number, not just an age. In order to retire, you need to have enough assets that will turn into enough income to live on and to last through all retirement years. You should definitely look into multiple products and put at least 2/3 of your assets into something that will generate a guaranteed rate of return, such as life insurance and annuities. This will have many implications on your retirement future, including planning for taxes and estate planning. Congratulations on asking the 'extra' question that most fail to look into! Would be happy to answer more if you have more questions. Best of luck!

$commenter.renderDisplayableName() | 05.24.17 @ 21:55

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July 14, 2015

Henry I agree with most of what has been said. We in the financial advice business often respond to questions with questions like what is the time frame we are dealing with, what is your ability to accept risk, how much per year can you save, are the other parts of your life in order and so on. These are questions that need to be answer before you or anyone can make a recommendation.
For example age is a vital factor the younger you are the easier meeting long term goal can be, A roth IRA or Roth 401k for a younger person can significantly change the amount you save and most importantly the amount you can spend in retirement.
As far as fees for retirement plans if you do some looking around and ask some good questions you can get fees that are fair so don't let that stop you from looking at 401k and IRA methods.

$commenter.renderDisplayableName() | 05.24.17 @ 21:55

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March 26, 2016

As an Investment Manager, we first need to know your number? Figure out how much you will need in retirement first. then work backwards using your MARR (Minimum Acceptable Rate of return).

Your return on investment (ROI) is more valuable than "tax saving products".

For example:

If you need $50k/yr in today's money, this is $100K/yr in 24 yrs (at a 3% inflation rate). So, if your plan only nets you $50K/yr matters not EBT or EAT-your needs are not being met. Meaning your expenses are exceeding your income.

We can help you estimate your number and put a value on your financial needs in retirement. Send me a message. No obligation.

We love to actively manage self-directed retirement plans. as a Fiduciary, we can customize it to suit your needs. Whichever plan you use, always keep a margin of safety.

It's not what you make, It's what you keep that determines your lifestyle.

$commenter.renderDisplayableName() | 05.24.17 @ 21:55

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June 29, 2016

There really is no best way that any of us can give you that would be the same for somebody else. Except for one constant, the habit of saving something somewhere. Without that habit, doesn't matter. So the best way to save for retirement is to form the habit of saving.

As far as what is the best choice, that will depend on your situation and how disciplined a saver you are. If you have trouble setting aside money "after" your paycheck gets to you, payroll deduction plans might be a better option for you. Do you want tax savings now or later? Do you need write offs right now? If not, does something like a Roth or an annuity work for you?

Then you also look at are you going to get help (matching) from your employer for using their plan?

The big thing is I will never tell somebody who has saved a bunch of money that they were wrong. They might not have used the best investment choice, but the did develop the habit of saving, which is something far too many people lack.

$commenter.renderDisplayableName() | 05.24.17 @ 21:55

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