Do you have dreams for your retirement? Whether your plans are to travel the world, spend your days fishing, or enjoy time with the grand kids, one thing you do not want to spend your retirement doing is worrying about money. Unfortunately, many seniors spend their golden years working longer than they should and trying to make life work on a shoestring budget.
SinclairProsser Law wants to help spare you from this fate. Our lawyers will work with clients to help ensure they have a solid plan for achieving retirement security. Give us a call at 410-573-4818 or 301-970-8080 to discover how our legal team can help with the creation of a personalized retirement plan and to find out answers to key questions including:
- When should retirement planning begin?
- Why are IRAs an important part of retirement planning?
- How can an Maryland Retirement Planning Lawyer Help?
When Should Retirement Planning Start?
Retirement planning should start as soon as you are earning income. You want to be able to save for your retirement so you have enough money to live comfortably without financial stress or worry. The earlier you begin saving, the easier it is for you to grow a substantial nest egg since you are able to take advantage of compound interest. With the magic of compound interest, you invest less than someone who began saving later, and can still end up with more assets when retirement time comes.
If you have not started planning for your retirement when you are young, it is never too late to take action. Saving something is better than saving nothing, and most people need to put aside some money to live on when they are older because defined benefit plans are rare today and many people do not have employer pensions any more. Social Security does provide income, but it is often an insufficient amount to live on, and you don’t want to have your opportunities restricted by financial shortfalls during your golden years.
Another important reason to begin retirement planning early is because there are tax-advantaged accounts you can put your money into. However, you have annual contribution limits for these accounts. When you miss a year and don’t invest, the tax deduction for that year’s savings is forever forfeited.
Why are IRAs an Important Part of Retirement Planning?
Individual Retirement Arrangements (IRAs) are a retirement planning tool that virtually everyone should use. IRAs are a supplement to a 401(K) or an employer’s plan if you have such a plan at work. They may also be your only option for getting a tax break for retirement savings if there are no employer-based retirement plans at your workplace.
IRAs let you contribute a certain amount each year. Depending upon your income level and whether your spouse has a retirement plan at your workplace or not, you may be able to take a tax deduction for up to the full amount of your contributions if you invest in a traditional IRA. If you invest in a Roth-IRA, there is no tax deduction at the time of investing, but the tax break comes when you take money out and you are not taxed on it.
Both traditional and Roth-IRAs make saving easier because the tax break means that the government subsidizes some of your savings. There are also other types of IRAs, called Simple IRAs and SEP-IRAs, for small business owners and entrepreneurs who earn non-wage income and who want to be able to take care of themselves during their golden years.
You should determine whether you are able to make a tax-deductible contribution to your IRA each year based on your age, your income level, and whether you or your spouse have a workplace retirement plan. You also need to know the rules for withdrawing money as a senior. An experienced retirement planning lawyer can provide you with assistance in understanding the rules for IRA investments.
How can a Maryland Retirement Planning Lawyer Help?
SinclairProsser Law is 100 percent committed to providing comprehensive retirement planning help to clients in Annapolis, Bowie, Millersville, Waldorf and surrounding areas in Maryland. We will work with you to make the most effective use of available tools to jump start your savings and make financial security possible during your golden years. Everyone, no matter their income, can save to achieve a secure retirement. Just contact us online or give us a call at 410-573-4818 or 301-970-8080 to find out how we can help.