TIP OF THE WEEK
There are so many questions people have — no matter their age or stage in life — about saving for retirement: When is the right time to start saving? How much should I be putting aside? What are the savings vehicles I should be using?
While the answers vary for everyone, depending on their individual situation and goals, there is one way to save for retirement that truly works for everyone.
An IRA is an investment option available to anyone who wants to start saving, and is a great way to either supplement an employer-sponsored retirement plan — such as a 401K — or for people who may not have access to such a plan. IRAs are a “bucket” that holds different assets for investment growth and can include stocks, bonds, CDs and more.
There are several different types of IRAs to choose from, but it might be worth getting help when it comes to deciding which is your best option.
The three main types of IRAs are Traditional, Roth and SEP:
Traditional IRA: This investment helps you save on taxes, since all of your contributions are tax deductible. When you withdraw funds for retirement, they are taxed at your current income tax rate, but there are penalties for drawing money before age 70 1/2.
Roth IRA: A Roth IRA provides a bit more flexibility. Contributions are made with your post-tax income, which means you can’t deduct them on your annual income tax. A benefit, however, is that you are able to draw money earlier without paying a penalty, so long as you don’t withdraw more than you’ve personally contributed. Any interest that you earn on your Roth IRA is not accessible until age 70 1/2 without penalty.
Simplified Employee Pension (SEP) IRA: SEP IRAs are available to business owners and are a great option for people who are self-employed to save for retirement. Contributions are tax deductible, and money can be withdrawn at any time. Any withdrawn funds are subject to income tax as well as an additional 10 percent tax if drawn before age 59 1/2.
One important note is that each of these IRA types has eligibility requirements and contribution limits. For example, if you have a 401K through your employer, there are limits to how much you can contribute to an IRA.
According to Forbes, the top 10 places where America’s highest earners are:
1. New York County, New York (49.2 percent earning more than $75,000)
2. Fairfax County, Virginia (49.2 percent)
3. San Francisco County, California (49.1 percent)
4. Santa Clara County, California (48.1 percent)
5. Norfolk County, Massachusetts (45.5 percent)
6. Montgomery County, Maryland (45.1 percent)
7. Washington D.C. (44.9 percent)
8. Monmouth County, New Jersey (44.4 percent)
9. San Mateo County, California (44.2 percent)
10. Westchester County, New York (42.2 percent)
NUMBER TO KNOW
2.6: According to Bankrate.com, ATM fees across the U.S. have climbed 2.6 percent since last year, with a national average of $4.69 for an out-of-network withdrawal.
Google Chrome to be more proactive about insecure sites
Google’s Chrome browser will be more proactive about warning users of insecure internet sites when the update for Chrome OS comes out later this month. Users can expect to see a “Not secure” warning in the browser’s address bar. The most commons scenario will be when a user begins to enter data on a site that doesn’t encrypt the connection. Google has also said that future versions will be more stringent for any sites lacking encryption.
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