No matter where you are on your Retirement journey, Servant Solutions is here to help you plan with confidence. Here are five strategies to consider as you save and plan.
• SET A GOAL
Contribute a minimum of 10% - 15% of your annual compensation between your contributions and employer’s contributions. Remember, the IRS rules say everyone can contribute, tax-deferred, a maximum of $20,500 during 2021. (For those who turn 50 or older this year, the IRS rules permit you to contribute an additional $6,500 tax-deferred as a “catchup” provision. This strategy builds your retirement account and saves you taxes.) Employer contributions can be above the individual limits stated above. For a full understanding, please go to our website under the “Plan Information” tab, then “Contribution Limits.”
• INCREASE CONTRIBUTIONS
As you receive an increase in your annual compensation, complete a new salary reduction agreement and increase your contribution by a minimum of 1% each year. Hopefully, you can increase it by more, but definitely increase it by 1% annually. You’ll like what it does for your retirement account’s balance as it grows for 15, 20, 25 or even 30 years! Finally remember that increasing your contributions during down markets buys more shares - something you’ll really like when the market goes back up.
• LEVERAGE WINDFALLS
If you ever have a “windfall” of cash (e.g. unexpected funds that are taxable or non-taxable) come your way, consider using the windfall funds, especially if they are taxable to you, to supplement the payment of your living expenses. (Invest them in a money market account that allows you easy access to them as you need them to pay your living expenses.) Also, complete a new salary reduction agreement with your employer that reduces your taxable income by a comparable amount to the windfall funds while staying within the federal limits for annual contributions as stated above.
• COMBINE ACCOUNTS
If you have 401(k) or 403(b) accounts from previous employers (traditional or Roth), you may roll them into your Servant Solutions account. Two things to consider in making this decision are: 1) How is your other account performing in relationship to Servant Solutions on a comparable investment? 2) What is the percentage of annual fees being charged on your other account? (NOTE: The average annualized fee percentage charged on Servant Solutions accounts is .85%...which is approximately half of the average annualized fee charged by most non-church retirement plans.) If you have any IRA accounts established (e.g. simple or traditional), you may also roll over these funds into your Servant Solutions account. (NOTE: If you have a Roth IRA account, you cannot roll these funds into your Servant Solutions account.)
• REMOVE THE GUESSWORK FROM RETIREMENT PLANNING!
Consider entering into our financial planning process - the FINANCIAL ROADMAP. A quick call to our office gets you started. Also consider the RETIREMENT WELLNESS SCORE tool on your account’s home page. These tools will help provide a clearer picture of your overall finances as well as an indicator of how your retirement planning is progressing. The very best part of these planning tools: They’re FREE! Also, as a member of Servant Solutions, you have access to our dedicated financial professionals to help you answer your questions at no additional cost.
Servant Solutions wants to be your life-long financial planning partner. We’re available with multiple tools and planning documents to help you arrive at your retirement years well-funded. Contact us today!