"Neither a borrower nor a lender be; for loan doth oft lose both itself and friend, and borrowing dulls the edge of husbandry." - William Shakespeare

SavingAdvice.com Blog

Bridging the gap between saving money and investing

Retirement

How To Retire Well in Pennsylvania

By Leave a Comment

How to Retire Well in Pennsylvania

If you have the option to live anywhere in the United States upon retiring, where should you go? Of course, you’ll factor in many things from weather to where your family resides. However, don’t neglect to consider the financial aspect. This includes cost of living, tax considerations, part-time retiree jobs, and more. Here is some of the info to consider if you want to know how to retire well in Pennsylvania.

Pennsylvania Cost of Living

You definitely want to think about cost of living when deciding where to retire. After all, the more you have to pay out in annual living costs, the more money you’re going to need to retire well. According to Best Places, Pennsylvania is slightly below average on most cost of living factors.

Most importantly, the median home cost in Pennsylvania is only $173,700. That’s significantly lower than the country’s average, which is $231,200. On the Best Places Scale, a score of 100 puts you at average, so anything below that is good. On the housing costs scale, Pennsylvania is a relatively low 75.1.

Pennsylvania does score slightly higher than average on a few cost of living factors. Transportation and grocery costs are slightly higher there than the median for the United States. On the other hand, it’s slightly lower in Pennsylvania for health, utilities, and miscellaneous costs. On that 100 scale, Pennsylvania is at 92.5 overall. Therefore, it’s a good place for many people to consider if they want to retire well.

Tax Considerations in Pennsylvania

Of course, you don’t want to live in a state that has a low cost of living but terrible taxes for retirees. Luckily, that’s not the case for Pennsylvania. According to an article that cites Pennsylvania as a great place to retire, there are many tax benefits for retirees.

Most importantly, it is one of only two states that does not tax residents’ retirement income. All pension income is tax-exempt at the state level in Pennsylvania. That’s a huge factor to consider. It’s definitely a reason to think about for how to retire well in Pennsylvania. After all, this means that the more retirement income you can accrue before retiring in Pennsylvania, the better off you’ll be.

Other tax considerations for Pennsylvania retirees include:

  • The federal income tax rate is low. It is a 3.07% flat tax rate. That’s actually the lowest in the United States!
  • The state sales tax is 6% which is one of the lowest in the country.
  • Moreover, food, clothing, and both prescription and non-prescription medication are tax-exempt in Pennsylvania.
  • There are military tax benefits for members and their surviving families.
  • Low-income home renters and homeowners can receive housing rebates in Pennsylvania that offset property taxes.
  • If you leave an inheritance to someone in your family who is under age 21, then there will be no estate tax on that inheritance.

If you have a strong retirement income and can benefit from tax-exempt status on things like medication and food then you can retire well in Pennsylvania. There are also several other tax benefits to consider for low-income, military, and people intending to leave an inheritance to younger family members.

Best Pennsylvania Cities for Retirees

Lancaster, Pennsylvania was recently named by the US News and World Report as the fifth-best city for retirees out of the entire country. It ranked especially high in health care. In fact, high-quality health care is one of the most important reasons that people retire well in Pennsylvania. Obviously, as we age, we need more health care. With quality care plus tax-exempt status for medication, Pennsylvania really offers a lot in this area.

Pittsburgh, Harrisburg, and Allentown are also within the top 40 on this list. Do note that Pittsburgh does have a local tax on top of the state tax. Philadelphia is the only other city in the state that adds a tax like this. That’s certainly something to consider if you want to retire well in Pennsylvania.

In a list by the same organization on the best places to live in Philadelphia, Lancaster is number two behind Harrisburg. Pittsburgh, Reading, and York are also in the top five. While it’s important to look at factors specific to retirement, it’s also smart to consider all quality of life factors. Do your research when thinking about where you want to retire. After all, your retirement lifestyle is entirely up to you.

Part-Time / Retiree Job Opportunities in Pennsylvania

If you want to retire well in Pennsylvania then you might think about getting a part-time job. Do something that you love that will also earn you a little bit of extra income. The Bureau of Labor Statistics reports that Pennsylvania has an unemployment rate hovering around 7% which is just about 1% higher than the national average. Chief executives, financial managers, sales managers, and of course doctors and lawyers all do well in Pennsylvania. That said, if you’re ambitious and seeking employment, you should be able to find part-time work in the state.

How Much Money Do You Need to Retire Well in Pennsylvania?

Everyone has different retirement needs. Therefore, you need to figure out exactly what it means to you to retire well in Pennsylvania. Nevertheless, it helps to have some guidelines. Go Banking Rates says that the average annual expenditure for Pennsylvania retirees is a little over $52,000. They recommend a 20% “comfort buffer.” As a result, they suggest an annual retirement cost of between $65,000 and $66,000.

In order to figure out how much money you need to retire well in Pennsylvania, you have to consider how long you’re likely to live there after retiring. At the above rate, you’ll need $650,000 to retire well there for a ten-year period. Of course, you can factor in your retirement income, which might include retirement benefits, pensions, part-time work, etc.

Do you have tips for how to retire well in Pennsylvania? We’d love to know about them in the comments below!

Read More:

 

If you enjoy reading our blog posts and would like to try your hand at blogging, we have good news for you; you can do exactly that on Saving Advice. Just click here to get started.

 

Check out these helpful tools to help you save more. For investing advice, visit The Motley Fool.

How To Build Your Own Retirement Fund

By Leave a Comment

Retirement planning is critical, and nearly everyone can consider it during their early professional careers. That’s because post-retirement is a stage in a person’s life during which he or she wishes to avoid all of life’s difficulties and live in peace and tranquility, free of financial obligations. If you want to enjoy a happy retirement later in life, you can begin saving soon. [Read more…] about How To Build Your Own Retirement Fund

You Can FIRE at 35 if You Do This

By Leave a Comment

You Can FIRE at 35 If You Do This

If you want to live as independently as possible, then you’re probably aiming for FIRE. In other words, you want Financial Independence, including to Retire Early. Obviously, you simply don’t want to get chained down to a 9-5 job for decades upon decades. Instead, you want to be free of that burden as early as possible. But how early in your life is it truly possible to FIRE? You can FIRE at 35 if you do these things:

Start Investing in Your Early Twenties

In fact, in today’s world, even teenagers have the opportunity to learn about investing. Smart parents can help their children plan to FIRE at 35 by teaching them about investments at a very young age. In any case, if you want to FIRE then you need to begin investing as early as possible. If you start investing and aggressively accumulating wealth in your early twenties then you’ll have more potential to FIRE at 35.

Investing tips for early retirement include:

  • Max out your retirement contributions. Get a job that matches a high percentage for you.
  • Invest in a variety of high-risk and low-risk opportunities,
  • For example, invest in stocks and low-index funds as well as cryptocurrency.
  • Constantly continue to educate yourself about smart investing. Don’t relax in this area.
  • Check this app to start investing

Develop Passive Income Streams As Early as Possible

This is one that teenagers and even younger kids can start doing thanks to today’s modern world. Kids can blog, vlog, and even earn money as social media influencers. There are children publishing books and online courses. As early as possible, begin to develop these types of passive income streams. After all, the blog you start at 15 might develop into something that can earn you passive income by the time that you’re twenty. This allows you to turn your attention and energy to other means of earning money while still generating income from that initial source. The more passive income streams that you have, the easier it is to FIRE at 35.

Enter a High-Income Job Industry

Your passive income and side hustles are important. However, before you FIRE, so is your main job. Therefore, you need to focus on earning as much income as possible from that job. You want to grow your salary year upon year. Work smarter, not harder to make as much money as you can. Tips for doing so include:

  • Get in on the cutting-edge of high-earning industries. For example, right now cryptocurrency is hot.
  • Go above and beyond to educate yourself. Become an expert in a niche field.
  • Make yourself indispensable. Do the job better than anyone else no matter what job you’re doing.
  • Consistently negotiate your salary up. Don’t hesitate to ask for more if you’ve earned it.

Start Your Own Business, Too

First, develop passive income streams. Continue to grow those throughout your lifetime. Then, get that high-paying main job. However, don’t ever forget that ultimately you want to be your own boss. As soon as possible into your career, start your own business. This is the business that you want to continue doing on your own once you officially retire.

After all, FIRE doesn’t necessarily mean that you never work again. It means that you retire from the 9-5, from working for someone else, from working because you have to pay the bills. FIRE means that you might run your own business part-time or full-time, remotely or however you see fit at any given time in your future. The earlier you can start that business,  the better off you’re likely to be. If you are open to transitioning from your regular job to full-time self-employment/entrepreneurship, then you can FIRE at 35.

Live a Super Frugal Lifestyle

Earning money, particularly through investing and other passive income streams, is the main portion of young financial independence. However, you also want to save as much money as possible. Learning to live a very frugal lifestyle from a young age can go a long way towards this savings. Things you might consider:

  • Forego an expensive college education. Hack your education instead of using the free resources that are out there. Or, at the very least, begin with community college.
  • Live car-free with roommates in an affordable city. The younger you are, the easier it is to adapt to this type of lifestyle because you’re not used to anything else, yet.
  • Stay out of debt. Do whatever it takes in your life to avoid getting into debt. You don’t want to pay money in interest. In contrast, you want to earn interest on your money.
  • Live well within your means. Remember, the stricter that you budget your money now, the more aggressively you can save for the future. This is what will allow you to FIRE early. Moreover, it will help you in your early retirement years if you need to live lean.

Figure Out the FIRE Life You Want to Live

Speaking of living lean, there are different types of FIRE lifestyles. You might plan for Fat Fire, Lean FIRE, or somewhere in between. It’s crucial that you decide early on what kind of FIRE lifestyle you’re aiming for. After all, that’s how you’ll set your goals. In order to FIRE at 35, you must get really clear on what your financial goals are. You have to set them, then power straight ahead to achieve them. So, learn as much as you can about the types of FIRE lifestyles people live. Constantly educate yourself about early retirement options through podcasts, blogs, books, and talking directly with others who live the FIRE dream. And make sure that you have realistic expectations of how much wealth you need in order to FIRE at 35.

Get a FIRE Mentor

If you want to live independently, then you might think that you need to do it all on your own. However, that’s false. The more support and guidance that you have, the more likely that you’ll succeed. Get financial experts involved in your life – both as professionals (such as a money manager) and as personal friends. Find yourself a FIRE mentor or two and lean on them for support as you go through your financial journey.

Read More:

If you enjoy reading our blog posts and would like to try your hand at blogging, we have good news for you; you can do exactly that on Saving Advice. Just click here to get started.

 

Check out these helpful tools to help you save more. For investing advice, visit The Motley Fool.

Control and Tax Benefits of ETFs

By Leave a Comment

Control and Tax Benefits of ETFs

More investors are seeking control and tax benefits of ETFs. And the rising tide of money pouring into ETFs may soon become a tsunami. As a result, you may want to catch the wave.

ETFs have been a popular way to invest since their inception in the early 1990s. Today, there are over 7,600 ETFs bulging with trillions of investment dollars.

What Is an ETF

An ETF (Exchange-Traded Fund) is a security that tracks an index, commodity, bonds, a sector, or other assets. It owns the underlying assets and divides ownership of those assets into shares which investors buy.

A major difference between ETFs and mutual funds is that ETFs are traded on an exchange such as stocks. As a result, an ETF’s price may fluctuate throughout the trading day. Mutual funds, on the other hand, are traded once daily after markets are closed.

Low operating costs, resulting in no or low fees, have made ETFs popular. In addition, they offer diversification, because many ETFs invest in an index such as the S&P 500. However, some ETFs focus on a single industry, which limits diversification.

Flow Goes to ETFs

According to Morningstar, an investment research and management firm, in eight of the last 10 years, more investor money has gone into ETFs than mutual funds. In fact, over $900 billion has left mutual funds and $1.8 billion has gone into ETFs in that time.

ETFs function much like mutual funds in that they have investment portfolios. On the other hand, ETFs are more liquid and more easily traded than mutual funds.

The Tax Appeal

The popularity of ETFs is expected to mushroom in the years to come. That is due, at least in part, to wealthy investors seeking the control and tax benefits of ETFs. 

President Joe Biden has proposed raising the top income tax rate for people making over $400,000 a year from 37 percent to 39.6 percent. In addition, he wants to tax long-term capital gains and qualified dividends at the ordinary income tax rate of 39.6 percent on income above $1 million.

The prospect of higher taxes has sent wealth investors looking for ways to earn high returns with low or no tax consequences. They have found ETFs.

Tax Benefits of ETFs

The way ETF shares are sold has the interest of wealthy investors. Here’s how it works.

If you own shares in a mutual fund and want out, the fund manager has to sell your shares on the open market. As a result, you may have to pay taxes on any profits.

With an ETF, you sell your shares directly to another investor. That way, neither you nor the fund has made a taxable transaction. 

No Commissions

Well, you say, aren’t we happy for Richie Rich and his friends. But I’m not in the top tax bracket. Why would I be interested in ETFs?

Good question. You might like ETFs because most trade commission-free, have lower operating costs, and are more flexible. That’s the control part of the ‘control and tax benefits of ETFs’.

Mutual Funds Converting to ETFs

ETFs are becoming so popular, you may already be investing in one without taking any action. That’s because some mutual funds have converted to ETFs.

History was made in late March when two Guinness Atkinson Asset Management mutual funds were converted to ETFs. In addition, Dimensional Fund Advisors has announced six tax-managed funds will convert to ETFs. That will begin June 11, when four funds will make the transformation. More conversions are expected, according to Ben Johnson, Morningstar’s director of global ETF research.

“Many of the advantages of converting a mutual fund to an ETF are synonymous with the advantages of the ETF wrapper. It’s all about where these funds will ultimately land, the packaging, the form that they’ll ultimately take. And I would argue that chief amongst those is the relative tax efficiency of the ETF packaging versus a mutual fund packaging”, said Johnson in a recent Morningstar podcast. “They avoid unlocking capital gains distributions, which have become very frequent, and in some cases, very large in magnitude within the realm of open-ended mutual funds in recent years. That’s a big benefit that would arise from a mutual fund to ETF conversion.”

Tax Impact of Mutual Fund Conversion

Cashing out your mutual fund can trigger a tax bill. However, that is not the case in a mutual fund conversion says, Johnson.

“The conversation of a mutual fund to an ETF will not be a taxable event for mutual fund shareholders”, said Johnson. “Their basis will remain intact. What, ultimately, investors will enjoy is effectively a form of tax deferral that they wouldn’t otherwise benefit from if that fund were to remain a mutual fund, seen continued in some cases in persistent outflows, which in recent years have resulted in these large and regular capital gains distributions.”

Everybody in the Pool?

You might think all mutual funds would convert to ETFs considering the lower costs and tax benefits. However, some mutual funds just can’t do that.

Many mutual funds have several share classes distributed among multiple platforms. Those elements make conversion difficult. Still, other funds are in pension and other retirement programs. They can not convert to ETFs. 

Bottom Line

So, are the heydays of mutual funds over? The heydays, yes, but they will not disappear. Retirement accounts such as 401(k)s and other retirement accounts will probably continue using mutual funds. After all, they are already tax-advantaged. In addition, recordkeeping is easier for managers.

However, for individual investors, the future points toward ETFs.

Read More

If you enjoy reading our blog posts and would like to try your hand at blogging, we have good news for you; you can do exactly that on Saving Advice. Just click here to get started. Check out these helpful tools to help you save more. For investing advice, visit The Motley Fool.

Weekly Financial Wrap: The Allure of Munis, Crypto Mining and the Open Road

By Leave a Comment

Weekly Financial Wrap

Surge in Municipal Bonds

Municipal Bonds have never been sexy unless you like steady tax-free income. Interest from munis is free from federal and state taxes if you are a resident of the state where the bonds are issued.

President Biden’s planned tax hikes have been credited with sending more money into munis. That has resulted in higher returns. In fact, municipal bonds have outperformed treasury bonds for seven straight months.

More To Come

With more cash pouring into municipal bond mutual funds, most analysts see strength in the market.

In a March report, Bank of America (BofA) concluded: “The American Rescue Plan, along with President Biden’s forthcoming infrastructure plan, forms the basis of the golden decade that we expect for muni market issuers through 2030.”

Positive Impact of Federal Aid

State and local governments are receiving $350 billion in aid from the $1.9 trillion stimulus plan signed into law on March 11 by President Joe Biden. As a result, S&P Global Ratings and Moody’s Investors Service upgraded their credit outlook for state and local governments from negative to stable.

Impact of Interest Rates

Earlier this year, treasuries fell on interest rate fears. However, municipal bonds rose. Certainly, municipals tend to do well when interest rates increase.

Are Munis For You?

Tax-free interest is appealing to high-income earners. But what about us average types?

Even if you’re not in the top tax bracket, municipal bonds may help with tax-free income. If your bond(s) are in your state, the interest they pay may be free of state and local states. If you live in a high-tax state, such as California or New York, that could be significant.

In addition to tax advantages, munis are safe, especially if you stick to high-rated bonds. For that reason, many retirees use municipal bonds to supplement their incomes.

Bottom Line

If you are looking for a reliable source of investment income with tax benefits, munis are a good option to explore. However, if you have a lot of time for growth, munis are not a good choice.

Travel Expectations

With the increase in vaccinations, more Americans are eyeing a vacation, according to Booking.com, a travel planning and reservation site. However, some travel options are limited.

Just over 71 percent of those surveyed by Booking.com say the roll-out of vaccines has made them more optimistic about traveling in 2021. In addition, 60 percent say they now view travel and vacations as more important than they did before the pandemic.

The result is that more Americans are planning to travel this summer than last year.

Taking Flight

Air travel began to pick up over the end of the year holidays and continued over spring break. The Transportation Safety Administration (TSA) has recorded over one million travelers a day since March 11.

Over 67 percent of Americans plan to travel this summer, according to Tripadvisor, an online travel site. That’s an increase of 17 percent.

Cruising

Cruise lines are cautiously setting sale again. However, bookings are being limited to comply with Center for Disease Control (CDC) restrictions. In addition, Spring cruises have been for rivers and coastlines in the United States. Caribbean cruises are scheduled for mid-summer.

On the Road Again 

While airline business is picking up, many Americans are planning to travel by car, according to a TripIt survey. 

“According to our survey data, 83 percent of respondents said they’d be ready for a road trip with a personal car by June,” stated the TripIt Survey. “60 percent of respondents said they’d be ready to take a road trip with a rented car or RV by June. That’s more than twice as many travelers expressing readiness to take a road trip with their own car versus boarding a domestic flight.” 

Control and Tax Benefits of ETFs

There is a monumental shift from mutual funds to ETFs. Many high-income investors like the tax benefits of Exchange Traded Funds, but there are more reasons investors like them. 

SA will explore this trend in Sunday’s edition.

Better Than Bitcoin?

Undoubtedly, you have watched or participated in the Bitcoin bull market. The cryptocurrency has jumped 525 percent over the last 12 months. However, there is another cryptocurrency investment that has far outperformed Bitcoin.

Riot Blockchain has gained 8,000 percent over last year. What is Riot Blockchain? It is a bitcoin mining company. Likewise, other crypto mining companies, such as Hive Blockchain and Marathon Digital Holdings have also posted substantial gains. 

Crypto Mining

Crypto mining companies, sometimes called farms, use high-powered computers to solve complex math problems. Subsequently, bitcoins are produced and placed in circulation.

“Bitcoin miners form the core backbone of Bitcoin’s blockchain,” according to market research firm Fundstrat. “In order to secure the Bitcoin ledger of transactions, miners burn electricity to computer-generated guesses aiming to solve cryptographic puzzles. The first miner to solve the puzzle receives the right to mine the next block and collect the associated block reward (6.25 Bitcoin subsidy and transaction fees) every ten minutes.”

With bitcoin topping $57,000, most of this week many retail investors find the cost of investing in the cryptocurrency prohibitive.

How To Invest

Another option for investing in bitcoin is by buying shares in a mining company. In addition, shares in mining companies are relatively cheap. Most are trading below $50 a share.

There is upside potential for mining stocks during the current cryptocurrency bull market. However, just as the currencies they mine can rise and fall dramatically, so can mining companies.

One way to limit risk is through a diversified mutual fund or ETF. However, until recently, there were no funds with mining interests. That changed last month when several ETFs began offering crypto mining as part of their portfolios.

A Word of Caution

These new mining stocks may rise high. However, they can also drop quickly. This is not where you put your retirement funds or money needed for other long-term goals.

Read More

If you enjoy reading our blog posts and would like to try your hand at blogging, we have good news for you; you can do exactly that on Saving Advice. Just click here to get started. Check out these helpful tools to help you save more. For investing advice, visit The Motley Fool.

The 4% Withdrawal Rate Is a Lie, Use This Instead

By Leave a Comment

4% safe withdrawal rate

For many years people relied on the concept of the 4% withdrawal rate to plan for retirement. However, many experts now say that this method is outdated. If you’re planning on using it for your own future, think again. There are better options for a safe withdrawal rate that you need to consider instead.

What Is the 4% Withdrawal Rate?

The 4% withdrawal rate is a percentage that many people use in retirement planning. The idea is that you should plan to withdraw approximately 4% of your retirement account each year once you retire. Obviously, the intention is to allow you to have a steady amount of income to meet your needs in retirement. At 4%, you are supposed to have what you need and yet not max out your retirement savings during your lifetime. While it’s a popular retirement planning method, many experts now agree that this is not a safe withdrawal rate.

The History of the 4% Withdrawal Rate

Kitces has a great interview with Bill Bengen, the so-called father of the 4% withdrawal rate. Bengen was a financial planner who was trying to solve problems in retirement planning in the 1990’s. He used historical data on finances over several decades to determine a safe withdrawal rate for retirees. His plan became the standard rule of thumb for other financial planners and their clients.

However, even in the 1990s, he didn’t actually use the 4% withdrawal rate. He recommended a 4.5% withdrawal rate for his clients instead. And in the Kitces interview, he says that in today’s world, a 5% withdrawal rate is probably a safe withdrawal rate due to low inflation.

There Are a Lot of Factors To Determine a Safe Withdrawal Rate

The 4% withdrawal rate relied on data from the earlier part of the 20th century. People simply aren’t in the same place now as they are then when it comes to money. Moreover, the world’s economy is different. When trying to assess a safe withdrawal rate, you need to take into account a wide variety of individual and economic factors.

As Bergen suggests over on Kitces, low inflation allows for a higher withdrawal rate. Money Sense notes that low interest rates are one factor. Increasing investment rates, and long life expectancies pose additional considerations. Think about it: are you planning to retire at 65 and likely to live to 95? That may greatly affect your retirement planning in comparison with someone who wants to retire earlier or later or who has a family history likely to end in a premature death.

And you have to consider your own feelings about retirement and the risks you’re willing to take with your money. Whereas Bergen says that 5% is now a safe withdrawal rate, Money Sense errs on the side of caution and uses a 3% withdrawal rate to plan for a long period of retirement. And Financial Samurai is even more conservative, suggesting 1% or less withdrawal at least in the early years of retirement.

Financial Samurai’s Alternative Safe Withdrawal Rate

Financial Samurai suggests this equation for your retirement planning: A safe withdrawal rate is a 10-year bond yield x 80. The article explains in-depth how this would mean that a $1 million retirement investment today would result in $17,000 of pre-tax income at the current bond yield of 1.7%.

The reason that they suggest this method is:

  • You don’t have to touch your principal. Living off your interest in retirement is ideal to give you a cushion in case you need it.
  • It’s a conservative option that allows you to plan not only for your future but for the generations beyond yours. In contrast, the 4% withdrawal rate uses up all of the money you have.

Financial Samurai has also provided a Safe Withdrawal Rate chart that ranges from 0.08% to 5.6% depending on the ten year bond yield.

An Alternative Retirement Plan

Financial Samurai also suggest another calculation. That option is to try to amass 20x your gross income before retirement. This allows you to gather what you need in order to survive well in retirement. Plus, it’s an easy calculation. However, it’s a bit simplistic.

Again, whenever you do retirement planning, you really need to think about a range of different factors. Life expectancy is a big one as is the quality of life you want to have when you retire. Moreover, you have to ask yourself if you want to spend out your retirement in your lifetime or leave something for the next generation. None of these are easy decisions.

Moreover, as Financial Samurai points out, you want to think about what retirement income might look like. Have you invested in risky, but potentially high-yielding investments? Are you able to use passive income or part-time work to supplement retirement income? Again, these are all important factors that might change the decisions you make about a safe withdrawal rate for you unique situation.

Working With a Financial Planner for Retirement Planning

Because there are so many different factors to take into consideration, you might want to consider working with a financial planner to figure out your financial retirement plan. After all the “father of the 4% withdrawal rate” was a financial planner. He used what he knew to help his clients. Like him, your financial planner will use the current rules of thumb as a starting point to assist you in figuring out what some good safe withdrawal rates might be. However, they will then take into consideration all of those other personal factors that might change this rate for you in either direction.

You don’t want to follow “rules” blindly when it comes to finances. As we’ve seen since the time that the 4% withdrawal rate was the norm, things change. Even if you stay up to date with the current recommended rates, your own personal situation might change. Developing a rapport with a financial planner who truly understands your needs and wants can be a good way to implement the right rules while circumventing those that simply don’t make sense for you.

What is your retirement plan? What questions do you have about planning for retirement?

Read More:

If you enjoy reading our blog posts and would like to try your hand at blogging, we have good news for you; you can do exactly that on Saving Advice. Just click here to get started.

 

Check out these helpful tools to help you save more. For investing advice, visit The Motley Fool.