Retirement & Saving Milestones
Early-Career | Establishing Strong Financial Habits
Starting out in your career can be an exciting time with a little extra jingle but managing finances during this period is critical. Prioritizing budgeting, debt management and early savings habits now could put you on the right path to long-term success.
COMMON PITFALLS AND TIPS
- Credit Card Debt – Keep your spending under control by paying off credit cards and buy now, pay later services on time - every time.
- Student Loans – Never miss a payment by setting up auto-payments and ask about student loan repayment benefits.
- Buying a House – Forget Keeping Up the Jones and avoid buying more house than you need, which could lead to other unexpected costs including repairs, taxes and utility bills.
Mid-Career | Accelerating Savings
You’ve acquired valuable skills and experience in managing your finances - great job! However, it can be easy to get too comfortable. Take the opportunity to review your financial situation and set new goals, so you don't miss out on accelerating those savings even further.
COMMON PITFALLS AND TIPS
- Retirement Savings – Aim to save 15% or more of your paycheck and let compound interest work to your benefit.
- Cash Flow Planning – Like a budget on steroids, you can align your investments with future income, expenses and major expenditures.
- Kids’ Education – Start a 529 plan as early as possible to grow tax-free savings for education.
Late-Career | Catch Up Savings
With retirement now on the horizon, it is time to calibrate your goals to ensure you are on track. Your mindset may be shifting to early retirement, legacy planning or funding healthcare needs.
COMMON PITFALLS AND TIPS
- Catch Up Savings – At age 50+, take advantage of the opportunity to save more for retirement.
- Social Security – Set a plan that’s right for you, if you can, wait to claim your max benefit at age 70.
Retirement Savings Benchmarks by Age
THE CHARTS BELOW CAN HELP YOU SEE IF YOU ARE ON TRACK FOR YOUR RETIREMENT SAVING GOALS.
News and Updates
Do I Need a Will?
If you own property, have savings, are married or have a dependent(s), then the answer is, yes. Believe it or not, you can make a will as early as eighteen, so it is never too early. It may sound morbid, but it’s smart to have a plan in place. Also be sure to update your will after any major life events.
RMD Updates:
The SECURE Act 2.0 updated a few required minimum distribution rules. Individuals can wait until age 73 (previously 72) to take a mandatory retirement savings withdrawal. Also, for retirees, new provisions reduce the pricey penalty for missing a RMD distribution from 50% to 25%; if the failure is corrected in a timely manner, it’s reduced to 10%. That’s good news for seniors.
Bill Franca AIF®
Al Smith
205 Powell Place, Suite 357
Brentwood, TN 37027
615-807-2951
Employee benefit consulting offered through Vision401K. Securities offered through Silver Oak Securities, Inc. Member FINRA/SIPC. Advisory Services offered through Vision Asset Management, a Registered Investment. Advisor not affiliated with Silver Oak Securities.
This information was developed as a general guide to educate plan sponsors and is not intended as authoritative guidance or tax/legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation.
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[1]Federal Reserve Bank of New York. “ Total Household Debt Reaches $16.51 trillion in Q3 2022; Mortgage and Auto Loan Originations Decline.” 15 Nov. 2022.
[2] Hanson, Savannah. “Average Credit Card Debt in the U.S.: Statistics for 2022.” Annuity.org. 5 Dec. 2022.
