10 IRA/401(k) Mistakes

IN TR ODUCTI ON
You’re Making
Pensions, Social Security, employment plans, estate planning,
annuities – with so many options for retirement saving, it can
be tricky figuring out where to begin! The sad truth is that
due to lack of knowledge on the subject, a lot of Americans
are painfully unprepared for the golden years and if current
trends continue, the retirement crisis is forecast to get pro-
gressively worse before the year is up. Factually, recent data
recovered by the Employee Benefit Research Institute shows
that trouble lies ahead for the millions of workers from the
baby boomer generation who have avoided planning and
saving for old age.

The survey conducted by the EBRI indicates a slight drop in

the percentage of American workers who stated that their
spouse has stashed funds aside for retirement, with findings
reaching their highest point in 2009 at 70%. Now, they stand
at 69%, but even fewer (30%) aren’t saving whatsoever! Typ-
ically, 26% of workers have stacked up just $1,000 in cash.
Figures reveal that 14% have $250,000 saved for their retire-
ment nest egg, 12% have $100,000 saved and the rest have
somewhere between $10,000 and $99,000. However, the sad
truth remains that most will struggle to fund the necessities
at this rate.
 If you are a senior and haven’t yet started calculating your
IN TR ODUCTI ON
retirement needs for an Investment Retirement Account
(IRA)/401(k) plan, there’s really no time to lose. Should you
have a plan but minimal funds approaching retirement age,
changes ought to be made before you feel the fiscal effects.
Perhaps you have been focusing on your finances for quite
some time now, but are not feeling confident about your in-
vestments? In reality, what might seem like a clever strategy
could potentially be costing you thousands of dollars.

Aside from the most common reasons why retirees are slack-
ing in the savings department, such as debts, education ex-
penses or other savings priorities, more often than not, the
problem comes down to baby boomer blunders. So ask your-
self, are you repeatedly making mistakes with your IRA/401(k)?
 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

Saving for Retirement –

When, Where and How?
When?
Ideally, you should start dripping money into an IRA/401(k) in your 20s but if this
hasn’t happened, now is as good a time as any. The sooner you save, the higher the
return each year and the better set you will be as a senior retiree. Strategies should
adapt as you age and a good idea is a target-date retirement fund.

Where?
As you probably already know, an IRA account or a 401(k) plan will be the best places
to put your money, due to the fact these strategies boast tax favors. Usual income
taxes can be high and leave a dent in your retirement savings. Savings accounts with
a tax deferral will escape ordinary taxes, which is one of many benefits.

10 IRA/401(k) Mistakes You’re Making 4

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

How?
Stock market fluctuations don’t necessarily mean you should put your money else-
where because when stock value grows, so will your nest egg. Don’t put all your eggs
in one basket when you are wondering how to invest the money. Mix up your invest-
ments to broaden your money-making opportunities, such as with precious metals,
real estate, annuities and bonds.

The typical rule of thumb for retirement planning and saving is to put aside at least
70% of your salary annually. However, most people won’t even come close to achiev-
ing this. By asking yourself the following questions and answering honestly, under-
standing how much you ought to save will be easy:

• What is your age right now?

• How many years do you want to spend in retirement and at what age?
• What is your life expectancy?
• Will you earn Social Security income? If so, how much?
• How much money have you currently saved for retirement?
• How much money do you feel comfortable saving on a monthly basis?

Although it is all good and well to have dreams about the years when you no longer
have to wear a shirt and tie, it’s crucial that you are realistic. Failure to think sensibly
could mean you wind up calculating that 100% of your salary will just about cut it!

10 IRA/401(k) Mistakes You’re Making 5

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

IRA an 401(k) Plans – An Overview

A comparison between retirement savings accounts is all that is required for most
people to make an informed decision regarding their finances for retirement. Com-
pany matches are not offered with an IRA like they are with a 401(k), so consider
funding a 401(k) before moving your dollars into an Individual Retirement Account.

Contribution limits and investment options will be set by the employer with a 401(k),
whereas the IRS chooses the limits for an IRA. Both options allow early withdrawals,
subject to a penalty fee of 10%. Penalty-free distributions will typically be granted
after the age of 59.5.

Avoiding the Financial Pitfalls

in the Retirement Years
Advertisements for IRA accounts can be deceiving. Images of unflawed retirement
scenarios are luring vulnerable people into rollovers that don’t actually benefit them
long-term. Everyone wants to make some money at the current time. After all, we
are facing another financial crisis.

Although the stakes are high, you can avoid jeopardizing your retirement if you are
clever enough to avert the following common IRA/401(k) mistakes:

10 IRA/401(k) Mistakes You’re Making 6

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

1 Money-draining Healthcare Costs

The Employee Benefits Research Institute has calculated that a typical couple aged
65 or over should have saved between $157,000 and $392,000 to afford health-
care. However, with so many people falling short of the recommended savings
amounts, this is proving to be a major cause for plan breakdown. A solution to
this problem would be to seek out a health insurance provider that offers compre-
hensive coverage, thus reducing the need for you to dig deep and leave a chunk
missing out of your savings.

10 IRA/401(k) Mistakes You’re Making 7

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

2 Early Retirement

Don’t be too scared at the thought of early retirement being a major baby boomer
blunder, because more often than not, life expectancy is longer than calculated.
Nevertheless, it can be pretty impossible to predict what lies around the corner,
whether it is a job loss, disability, a decline in health or taking on the responsibility
of caring for a loved one. The less you work, the less you will save and the more
your Social Security savings will take a hit. Although it cannot always be avoided,
preparing for the unexpected by investing more money now will provide you with
a safety net.

10 IRA/401(k) Mistakes You’re Making 8

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

3 Withdrawing a Lump Sum Pension

A lot of Americans think of their retirement plan as a loan source. Be warned that
it certainly is not that type of savings account and if you withdraw your pension in
big amounts, you’re going to get slapped with a penalty fee. Extortionate fees will
slowly eat into your savings therefore what might help you out temporarily could
tarnish your financial future.

10 IRA/401(k) Mistakes You’re Making 9

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

4 Withdrawing Money too Quickly

Just like you will be charged a penalty for withdrawing a lump sum pension from
your IRA/401(k), the same applies for early withdrawals. In some cases, such as to
fund education or a new home, there may be an exception. Don’t count on this
though because generally, an investor will face penalties if they don’t use their
savings account to its full potential.

10 IRA/401(k) Mistakes You’re Making 10

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

5 Failure to Calculate Needs for Retirement

We spoke about this before, but the importance of calculating needs for the gold-
en years doesn’t seem to stick in most Americans minds! A slap-dash approach to
figuring out exactly how much money will be enough to pay for rent/mortgage,
food, drink, bills and small luxuries could have an adverse effect. Financial advisors
normally recommend planning for 70-90% of retirement income, as this ensures
no money is left on the table and you are relieved of monetary woes as you get
older.

10 IRA/401(k) Mistakes You’re Making 11

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

6 Not Diversifying Investment Options

The most attractive investment portfolio for retirement will be diverse and the per-
fect portfolio will include a mixture of 6-8 investments. Always spend some time
researching investment options before going ahead and putting money down. Fur-
thermore, it is imperative that you research the fees associated with each and ev-
ery investment, from stocks and bonds to gold and real estate. Some tax brackets
will be significantly higher than others and unless you review these costs, vague
return estimates could prove costly. Never turn your nose up at investment advice
either. Individuals who listen intently to what those financial geniuses out there
have to say will be the smartest investors.

10 IRA/401(k) Mistakes You’re Making 12

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

7 Sticking to the Default Contribution Level

It’s shocking how many people are saving money in their 401(k) accounts at the
default contribution level. Sure, an employer will always select a default contribu-
tion level for your specific retirement savings account, but this does not mean you
have to stick to it. In fact, with the average default level being 2-3%, the amount
of money you manage to save each month might not be that much at all, depend-
ing on your wage of course. Even if you just increase the saving to a combined
rate, such as 15%, this smart move will make a massive difference. Alternatively,
increase the savings by 1% every month so that you can manage on whatever in-
come is leftover.

10 IRA/401(k) Mistakes You’re Making 13

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

8 Contributing at the Last Minute

Are you one of those people who thinks that there is plenty of time to start put-
ting funds into an IRA/401(k) and then panic at the last minute? If so, you could be
missing out on a whole lot of tax benefits, not to mention years of valuable savings.
When an IRA contribution doesn’t have much time to compound, how can you
expect to make a desirable rate of return? It’s just not possible and time will es-
sentially be wasted by doing this; you might as well not bother at all. Aim to reach
the limit set for your 401(k) by calculating how many fixed investments ought to be
funneled into the account over a certain number of months/years.

10 IRA/401(k) Mistakes You’re Making 14

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

9 Building Taxes on IRA Rollovers

When you have accomplished the task of maxing out your 401(k) contributions
make sure you roll it over. Some investors will forget to do this altogether and
those who do remember that they are eligible tend to do so incorrectly and trigger
a tax bill. Building taxes is not a good idea, because you might not have enough
money to pay them when the time comes, particularly if the tax rate inflates. A
Roth-IRA will be tax-deferred, allowing you to earn the highest possible amount on
investments like stocks, which appreciate best long-term.

10 IRA/401(k) Mistakes You’re Making 15

 TM
(855) GOLD - IRA
info@GoldcoPreciousMetals.com

Not Making Strategic Required

10 Minimum Distributions(RMDs)

After you reach the age of 70.5, you must start making required minimum distribu-
tions, which are also known as RMDs. Penalties will be applied if you fail to abide
by this rule. It’s actually beneficial to meet the RMDs, due to the potential it pro-
vides for getting a portfolio back into an attractive state. Don’t make the mistake
of forgetting about making spousal contributions, either.

10 IRA/401(k) Mistakes You’re Making 16

C O NCLUSION
How to Recover from the Current IRA/401(k) Crisis

By the time 2016 comes to a close, America will be sinking in

$19.3 trillion worth of debt, based on statistical data recov-
ered by the FY17 Federal Budget. Albeit a frightening fact, your
income and savings for retirement could perk if you know how
to sidestep the IRA/401(k) crisis. As a retiree, you will be eligible
to max out your 401(k) contributions of $18,000 and rollover
to an IRA. There is a plus to being aged 50 and over, too – you
can funnel an additional $6,000 into your 401(k).

Maxing out your contributions will equate to brilliant tax sav-

ings. Not everyone will be in a financial position to take ad-
vantage of this however and so, a different route to go down
would involve finding an employer match. Don’t shun a small
employer match, because every little helps, even if it’s a couple
of hundred dollars stashed away each month. If you launch a
Roth IRA or convert to a plan of this kind, tax-free earnings will
rise in value and when you withdraw, taxes will still be waived.
 BIBLIOGRAPHY
[i] http://money.usnews.com/money/retirement/arti-
cles/2015/11/23/how-to-maximize-your-retirement-accounts-
in-2016

[ii] http://www.thefiscaltimes.com/2016/03/22/American-
Retirement-Crisis-5-Charts

[iii] http://money.cnn.com/retirement/guide/basics_basics.
moneymag/index5.htm

[iv] http://time.com/money/3546592/ira-rollover-mistakes-
retirement/
 TM

632 Cangoga Ave. (855) GOLD - IRA

15th Floor info@GoldcoPreciousMetals.com
Woodland Hills, CA 91367 GoldcoPreciousMetals.com