Solving the Retirement Income Puzzle

Transcription

1 Solving the Retirement Income Puzzle Presented By: Karen A. Matland, CPA, CTFA Melissa K. Hennessey, CFP Director of Financial Advisory & Retirement Services Financial Consultant 1

2 Solving the Retirement Income Puzzle While you Wait! Please refer to the Social Security Statement (made available to download at to answer the True/False questions below. We will go over the answers once the webinar begins! 1. Wanda receives an 8% credit for each year that she delays benefits after her Full Retirement Age (FRA). True/False 2. Wanda must earn 40 credits before she can qualify for Social Security benefits. True/False 3. One credit is equal to $1,200 of wages or self-employment income for True/False 4. Wanda s Social Security benefits are NOT adjusted for cost-of-living increases. True/False 5. Wanda s family may be eligible to receive retirement and/or survivor benefits on her Social Security record. True/False 2

3 Today s Presenters Karen A. Matland, CPA, CTFA Director of Financial Advisory & Retirement Services kmatland@capecodfive.com Melissa K. Hennessey, CFP Financial Consultant mhennessey@capecodfive.com 3

4 Today s Discussion Topics Retirement Income Needs Retirement Income Sources Retirement Savings 4

5 Retirement Income Needs Q. How much income will I need? Budget % of current expenses Expenses that increase Health care costs Travel/leisure/hobby expenses Expenses that decrease/end Retirement savings Job-related expenses Payroll/income taxes Mortgage payments 5

6 Retirement Income Sources Q. How will I fund my retirement needs? Fixed income Social Security Pension Annuities Variable income Income from assets Wages Source: Social Security Administration calculations from the March 2012 Annual Social and Economic Supplement to the Current Population Survey. 6

7 Retirement Income Sources: Social Security Q. What Social Security basics should I know? Eligibility requirements 40 credits Benefit calculation 35-year work history Key benefit collection ages 62, FRA or 70 Strategies to maximize spousal benefits File & Suspend Restricted Application 7

8 Source: Social Security Administration calculations from the March 2012 Annual Social and Economic Supplement to the Current Population Survey. 8

9 Retirement Income Sources: Social Security Q. What Social Security basics should I know? Eligibility requirements 40 credits Benefit calculation 35-year work history Key benefit collection ages 62, FRA or 70 Strategies to maximize spousal benefits File & Suspend Restricted Application 9

10 Source: Social Security Administration calculations from the March 2012 Annual Social and Economic Supplement to the Current Population Survey. 10

11 Retirement Income Sources: Pension Plans Q. Am I eligible to receive pension benefits? Public vs. private sector Eligibility requirements Pension options Periodic or lump sum payments Payout periods 11

12 Retirement Income Sources: Annuities Q. What is an annuity and how does it work? Purpose Payment options Immediate/Deferred Fixed/Variable Term options Life annuity Period certain Joint & survivor Lump sum 12

13 Retirement Savings Q. What other retirement savings options are available? Employer sponsored plans 401(k) 403(b) 457 SEP/Simple IRA Self-directed plans Traditional IRA Roth IRA 13

14 Resources Retirement Goal Assessment Tool Cape Cod Five Savings Fitness: A Guide to Your Money and Your Financial Future Let's Make a Plan Taking the Mystery Out of Retirement Planning US Dept. of Labor 14

15 Disclosure This presentation and the information provided is intended for discussion purposes only and by itself should not be the basis for any specific planning decisions. You should always consult with your attorney, tax advisor or other appropriate professionals before changing or implementing any financial, estate or tax planning strategy. This workshop is a part of The Cape Cod Five Cents Savings Bank s commitment to provide financial educational information to the communities we serve. Karen A. Matland, CPA, CTFA Director of Financial Advisory & Retirement Services kmatland@capecodfive.com Melissa K. Hennessey, CFP Financial Consultant mhennessey@capecodfive.com 15