Like most of us, you may someday want to enjoy a comfortable retirement. Your ability to achieve this goal will depend on how much you save but it also matters how much you spend. And saving and spending are certainly related: The more you can reduce your spending, the more money you could have available to save for retirement through your IRA and your 401(k) or other employer-sponsored retirement plan. Over many years, even relatively small amounts diverted from spending to saving and investing could add up substantially. How can you go about potentially reducing your spending? Here are a few suggestions: Use a budgeting tool. If youre not already doing so, you might want to consider using a free online budgeting tool. Among other capabilities, these apps can place your spending in categories groceries, travel, entertainment, and so on which can reveal redundancies that, once eliminated, could save you money. For example, you might find that youre spending a not-insignificant amount on streaming services you rarely use. Or you might be surprised at how often you go the grocery store, rather than consolidating your visits and reducing the likelihood of impulse purchases. Take advantage of employee benefits. If you work for a mid-size or large company, you may have an extensive employee benefit plan, which could include discounts on some products and services. Also, if you are enrolled in a high-deductible health plan through your employer, you might have access to a health savings account (HSA) or flexible spending account (FSA), either of which may let you lower your out-of-pocket health care costs by using pre-tax dollars to pay for deductibles, copayments, coinsurance and some other qualified expenses. Shop around for insurance. To some extent, we are all creatures of habit, which can be good in some circumstances and not so good in others. In the not so good category, many people stick with their auto, homeowners and life insurance policies year after year, even though they might be able to save some money by switching to another company. But even if you stay with your current company, you might find ways to save money by taking steps such as adding a home security system. Check with your insurer to learn more. Compare credit cards. Theres a piece of financial advice that essentially says: Pay cash for everything and this isnt a bad idea. Ideally, you might want to use a credit card strictly for items such as car rentals or hotel reservations, and you should pay off the bill each month to avoid interest charges. Sometimes, though, you may need to use your card for other purposes, and it may not always be possible to pay your bill in full. Thats why youll want to review credit cards periodically to find one with lower interest rates, a favorable balance transfer offer and a better rewards program.Its not always easy to cut down on your spending, but when you do, it can provide more peace of mind and an opportunity to boost your savings for what could be a long and active retirement. Chad Choate III, AAMS 828 3rd Avenue West Bradenton, FL 34205 941-462-2445 chad.chaote@edwardjones.comThis article was written by Edward Jones for use by your local Edward Jones Financial Advisor.
In the popular imagination, receiving an inheritance always sounds like a good thing after all, who doesnt want a financial windfall? And inheritances can certainly be life-altering events. But they can cause challenges, so youll want to help your heirs be prepared. To assist in this preparation, try to address some key questions affecting your heirs: Do they know whats in your estate plans? Your family and other heirs will be much better prepared to deal with an inheritance if they know what to expect. Thats why its so important that you share your estate plans with everyone involved. You need to let them know the wishes and decisions youve expressed in your will and other legal arrangements, such as a living trust. Of course, sharing this information doesnt necessarily mean that all your heirs will be completely satisfied with your choices but at least they wont be surprised, and perhaps will be less likely to cause disputes when the time comes to settle your estate. Will they know what to do with the money or other assets? You may be planning to leave your grown children a sizable amount of assets, possibly including cash, stocks, real estate, IRAs, 401Ks or other types of valuable personal property. But this inheritance brings with it several possible questions: Do your heirs already have an investment platform ready to accept inherited stocks? If you do leave behind rental property or a vacation home, can it be easily sold? These types of issues are generally not hard to resolve, but the more prepared your heirs are for their inheritance, the quicker they can take whatever actions are needed. Are they prepared to handle any taxes that may result from the inheritance? Unless you have a very large estate, your heirs likely wont face federal estate taxes. (In 2024, the first $13.61 million of an estate is exempt from federal estate taxes.) However, other types of taxes may apply. A few states assess state inheritance taxes, and your heirs could incur federal and/or state income taxes when they withdraw money from inherited assets funded with pre-tax dollars, such as some retirement accounts. They could also face capital gains taxes when they sell inherited assets, such as stocks, for more than they were worth at the time of the inheritance. In any case, inheritance-related taxes can be complex, so you and your family and other heirs should discuss these issues with your tax advisor. Will they be liable for any outstanding expenses? If you have developed a comprehensive estate plan, it's unlikely your heirs will be on the hook for any outstanding expenses, such as credit card balances or funeral costs. If you do still carry a mortgage, though, and you are planning on leaving your house to your heirs, they may want to be prepared to act quickly to sell it. When leaving an inheritance, theres a lot involved emotionally, financially and legally. So, do whatever you can to make the entire process as easy as possible for your loved ones. By communicating your wishes regarding the inheritance, and by considering all the issues that may arise, you can go a long way toward achieving the outcomes you desire. Chad Choate III, AAMS828 3rd Avenue WestBradenton, FL 34205941-462-2445chad.chaote@edwardjones.comThis article was written by Edward Jones for use by your local Edward Jones Financial Advisor.
If youre a parent, you want to do everything you can to help your children succeed in life. Therefore, you might think that one of the best things you can do is to save for your childrens college education. And this is certainly admirable, but could it conflict with your ability to prepare for another key goal your own retirement?Of course, this would not be a problem if you had unlimited means, but most of us dont fall into that category. So, given the financial resources and income you do have, how should you approach the college-versus-retirement issue?Fortunately, its not necessarily an either-or scenario. However, it may make sense to prioritize saving for retirement over college, for two reasons.First, your children have a lot more time to pay for college than you have to save for retirement. In addition to any grants or scholarships your children may receive, they might need to take out loans. While its a good idea to keep this debt load as manageable as possible, its also true that most student loans can be repaid over a long period of time.And heres the second point: One of the best gifts you can give your children is to be self-sufficient in your retirement. You could easily spend two, or even three, decades as a retiree, so you will need to build considerable financial resources to pay for all those years. Your adult children will have their own financial needs to address, so youll be doing them a great favor by relieving them of any financial responsibilities on your behalf. Taking these factors into account, you may want to direct most of your saving and investing efforts toward achieving a comfortable retirement. Consequently, think about putting away as much as you can afford into your IRA and 401(k) or other employer-sponsored retirement plan. Even with this focus on retirement, though, you may find opportunities to save and invest for your childrens education. For example, if you receive bonuses or income tax refunds, or your salary goes up, or youre able to free up money from your budget by reducing your debts, you could use these funds to invest in an education savings vehicle, such as a 529 plan. When you invest in a 529 plan, your earnings and withdrawals are federally tax free, provided the money is used for qualified education expenses such as tuition, room and board, books, and computers. Depending on where you live, you may also get some state tax benefits from your 529 plan. And a 529 plan isnt just for college it can be used for K-12 private school tuition costs, plus expenses from qualified apprenticeship programs, such as those found at trade schools eligible for Title IV federal student aid.It might not be easy to save and invest consistently for your retirement and your childrens education. But both goals are worthy after all, retirement can last a long time and college is expensive. So, try to develop a financial strategy that can allow you to make progress in both areas your efforts may well be rewarded. Chad Choate III, AAMS828 3rd Avenue WestBradenton, FL 34205941-462-2445chad.chaote@edwardjones.com This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.
Assisted Living Locators is your trusted local partner for one of the most important decisions you'll ever make: finding the right senior living option for your loved ones. Navigating the world of senior care can be overwhelming, which is why our Care Advisors are here to guide you every step of the way. From answering your questions to addressing your concerns, we ensure you feel confident and comfortable with your decisions.With over a decade of experience, Assisted Living Locators has helped over 100,000 families find caring providers for their loved ones. Our network of local experts is dedicated to matchmaking seniors with the perfect housing or care options, including assisted living communities, Alzheimer's and memory care communities, in-home care, nursing homes, and more.Using our free Care Assessment Tool, you can explore all the senior living and in-home care options available to find the perfect fit for your loved one's needs. Our certified advisors are here to simplify your search, help you understand your options, compare costs and services, and provide unbiased, expert guidance to make the best senior care choices for your family.
Assisted Living Locators is your trusted local partner for one of the most important decisions you'll ever make: finding the right senior living option for your loved ones. Navigating the world of senior care can be overwhelming, which is why our Care Advisors are here to guide you every step of the way. From answering your questions to addressing your concerns, we ensure you feel confident and comfortable with your decisions.With over a decade of experience, Assisted Living Locators has helped over 100,000 families find caring providers for their loved ones. Our network of local experts is dedicated to matchmaking seniors with the perfect housing or care options, including assisted living communities, Alzheimer's and memory care communities, in-home care, nursing homes, and more.Using our free Care Assessment Tool, you can explore all the senior living and in-home care options available to find the perfect fit for your loved one's needs. Our certified advisors are here to simplify your search, help you understand your options, compare costs and services, and provide unbiased, expert guidance to make the best senior care choices for your family.