For the investor that loves a high degree of uncertainty, these are the best of times. More volatility offers more opportunity to make money. For the investor that prefers calmer more predictable markets, these are stressful times indeed.
Yet the truth is that even the most detailed, well thought out investment plan I could possibly develop for a client could go kaput next week due to a million reasons beyond our control.
Should you choose a ROTH IRA or a Traditional IRA? That’s a tax planning question that deserves much scrutiny. First thing you need to do is find out if you’re eligible to contribute to a Roth IRA. Here’s a link that can help determine the answer: Roth IRA Income Eligibility
Let’s say for argument sake you’re eligible to contribute to either a Roth or a Traditional IRA. If you take the Traditional IRA route, you’ll deduct the IRA contribution from your reported income which will have the effect of lowering your income tax bill.
Your Father’s Retirement Plan vs. Your Retirement Plan - the 3 Major Differences
When it comes to achieving financial success in your life, one of your most valuable assets is your ability and capacity to make clear and decisive financial decisions. Procrastination, the opposite of decision, is by far the most challenging hurdle to overcome if you’re to reach your short as well as long-range financial goals.
Reaching Decisions Promptly
Robert Reich, former Secretary of Labor during the Clinton Administration is someone that always speaks truth to power. He has a new book out called “After Shock” that is definitely worth a read. In my opinion, he truly understands the plight of the ever shrinking middle class in our country and is fighting back at every turn he can.
He just posted a new blog about the current drama playing out in DC. Please give it a read: http://robertreich.org/post/2060506381.
Unless your plan for financial independence is based on luck, winning the lottery or an unknown relative that decides to leave you their estate, like most people, you’re going to become financially independent the old fashioned way-you’re going to earn it.
And the way you’re going to earn it is by saving money. And saving money means delaying consumption today (delayed gratification) for a brighter and more prosperous future tomorrow. But that’s easier said than done. The simple truth is spending money is way more fun than saving money.
On Thursday, I watched in shock and horror as the US House of Representatives failed to approve a bill that would have authorized additional insurance for the long-term unemployed. The unemployed do not have lobbyists in DC fighting for them. They are in fact politically disempowered. Yet against this backdrop of events, there’s wide agreement among most economists that UI insurance helps the economy and provides many a chance to barely keep their head above water.
But think about what’s going on here. According to the Center for Responsive Politics, 237 members of Congress are millionaires. That’s 44 percent of the body-compared to (CRP) about 1 percent of Americans overall. CRP says California Republican Rep. Darrell Issa is the richest lawmaker on Capitol Hill, with a net worth estimated at about $251 million. And in the Senate, it’s even more out of whack with 60 out of our 100 Senator’s multi-millionaires. Out of touch much?
So how does the current state of the economy and the state of the stock market in the year you retire, influence the retirement income you have to live on for the rest of your life?
Lower Investment Returns
