Retirement Planning For Dummies

Title Page
Copyright Page
Table of Contents
Introduction
About This Book
Foolish Assumptions
Icons Used in This Book
Beyond the Book
Where to Go from Here
Part 1 Getting Started
Chapter 1 Retirement Planning Is Up to You
Blazing Your Own Retirement Plan
Measuring Your Lifespan
Social Security Administration’s Life Expectancy Calculator
Bankrate’s Life Expectancy Calculator
Living to 100 Life Expectancy Calculator
Retirement Planning Beginnings: The Pension
Changing Times: The 401(k)
Behold the power of the 401(k)
An opportunity to save
Social Security: The De Facto Safety Net
Chapter 2 Determining How Much You Spend
Finding Out Where Your Money Goes
Eyeing your expenses
Tracking your money’s every move
Spending guidelines
Measuring Your Spending
Using your credit card company or bank’s online resources
Diving into the world of third-party apps and online tools
Checking out other money-tracking options
Doing something with all this data
Putting Your Spending in Context
Using government statistics as a guide
Seeing how spending changes as you age
Improving Your Numbers
Figuring out if your latte is ruining your retirement
Finding easy ways to stop wasting money
Boosting your income with a side gig
Chapter 3 Calculating How Much You Need to Retire
Getting to Know the 4 Percent Rule
How the 4 percent rule works
The magical power of the 4 percent rule
Shortcomings of the 4 percent rule
Using Online Retirement Calculators
Getting started
Exploring retirement calculators from mutual fund companies
Drilling in with detailed retirement calculators
Avoid gambling with retirement: Monte Carlo analysis
Understanding Why Starting Early Is Important
Compounding: The most powerful force in the universe
Inspiration to start retirement planning now
The race to $1 million: Doable if you start soon
Chapter 4 Choosing the Right Account
Retirement Planning in a Nutshell
Getting started
What about pensions and Social Security?
A Great Place to Start: 401(k)s
Advantages of 401(k) plans
Drawbacks of 401(k) plans
The Roth: An interesting twist on retirement savings
IRAs: A Cornerstone of Retirement Planning
Advantages of IRA plans
Drawbacks of IRA plans
A few IRA odds and ends
Self-Employed Plans
The spectacular SEP-IRA
The 401(k) for one: A one-participant 401(k)
Keeping it SIMPLE
What’s the Catch?
Tax-deferred isn’t tax-free
Beware the 10 percent early withdrawal penalty
Don’t mortgage your future: Retirement plan loans
Chapter 5 Gauging Your Appetite for Risk
Getting a Handle on Your Risk Tolerance
Determining your investor type
Understanding risk tolerance
Looking at risk tolerance differently
Using risk-assessment tools
The ABCs of Asset Classes
Putting stocks in a box
Adding bonds
Including a few other asset classes
Seeing how risk tolerance and returns work together
Chapter 6 Opening Your Accounts
Getting Your 401(k) Up and Running
Understanding target-date funds
Knowing the people involved in your 401(k)
Getting familiar with your 401(k) plan
Plugging into Your IRA
Knowing what you’d like to own
Choosing someone to handle your IRA
Mutual fund companies
Traditional and discount online brokerages
Robo-advisors
Connecting with a Financial Planner
Finding a financial planner
Deciding what is right for you
Part 2 Using Online Resources
Chapter 7 Managing and Optimizing Your 401(k)
Getting Online
Registering for 401(k) access
Getting to know your 401(k) tools
Checking your performance
Checking Your Portfolio Allocation
Understanding the key asset classes
Looking at your current mix without using a calculator
Finding your optimal asset class mix
Changing your asset allocation
Powering Your 401(k) with Contributions
Inspecting your current contribution level
Deciding how much to contribute
Seeing the power of putting more away
Discovering Other Nifty Aspects of Your 401(k) Plan Site
Locating information on plan loans and withdrawals
Digging into the statements
Finding various plan documents
Chapter 8 Taking Your IRA to the Next Level
Getting Online with Your IRA Provider
Opening your IRA account
Logging in and looking around
Understanding your portfolio holdings
Checking Your Portfolio Asset Allocation
Understanding correlation
Viewing your asset allocation on your provider’s website
Enhancing your asset allocation
Understanding Your IRA Contributions
Setting up IRA deposits
Roll over Beethoven: IRA rollovers
Funding an IRA with a Roth conversion
Taking Money out of Your IRA
Getting money out early: 72(t) distributions
Taking your required minimum distribution
Setting up a beneficiary
A word about inherited IRAs
Chapter 9 Optimizing Your Retirement with Third-Party Offerings
Understanding Fees
Improving success with lower fees
Knowing the types of fees
Uncovering the shocking truth about fees
Examining Your Portfolio Using Morningstar
Pulling up individual funds that you own
Putting your entire portfolio to the test
Putting Your 401(k) Under the BrightScope Microscope
BrightScoping your 401(k)
Learning more about your funds
Getting to know your advisor
Grading Your Retirement Plans in Other Ways
X marks the spot for a better 401(k)
Getting up close and personal with Personal Capital
Chapter 10 Digging into Social Security
Discovering All the Benefits of Social Security
Disability coverage (SSDI): The forgotten bonus of Social Security
Medicare for All
Survivors benefits
Retirement benefits
Managing Social Security Information Online
Examining what you’re paying into Social Security
Signing up for and accessing Social Security information online
Understanding your history of Social Security credits
Planning for Social Security in Retirement
Claiming your Social Security benefit
Applying for benefits
Part 3 Maximizing Your Retirement Knowledge
Chapter 11 Balancing Retirement Savings with Other Needs
Cleaning Up Your Personal Balance Sheet
Building an emergency fund
Cutting the debt anchor loose
Opening a taxable brokerage account
Saving for a Home
Seeing how a retirement plan can help
Knowing how much you can afford
Budgeting for homeownership
Saving for College
Understanding why your help matters
Choosing a college-savings account
Choosing a 529 provider
Figuring out how much you should save
Chapter 12 Fine-Tuning Your Asset Allocation
Exploring Stock Strategies
Understanding small versus large companies
Knowing where your money is: international, global, and emerging markets
Trusting real estate investment trusts
Diving for Income
Getting to know bonds better
Going to town with municipal bonds
Using Morningstar to study bonds
It’s Easy Being Green: The Rise of ESG
Deciding whether to include ESG in your retirement plan
Understanding ESG investments
Buying into an ESG
Chapter 13 Keeping Your Retirement on Track
Tracking Your Portfolio’s Health
Measuring returns and asset allocation
Modifying your plan
Tracking and Updating Your Goals
Assessing your goals
Seeing if your goals change your plans
Tracking retirement progress and milestones
Chapter 14 Gearing Up for Retirement
Creating a Retirement Budget
Test-driving your budget
Keeping your stock exposure
Waiting until 70 to collect Social Security
Having a healthcare plan
Knowing the bucket strategy
Working longer
Thinking about Annuities
Understanding the types of annuities
Finding an immediate annuity
Running sample annuity numbers
Unlocking a Goldmine: Reverse Mortgage
Understanding reverse mortgages
Understanding the drawbacks of reverse mortgages
Using a reverse mortgage
Chapter 15 Understanding Pensions
Checking a Private Pension’s Funding
Understanding the Problems with Public Pensions
Understanding Pensions Inside-Out
Choosing a lump sum versus ongoing payments
Choosing single life versus survivor
Managing Your Pension
Using online tools
Calculating the value of a lump sum payment
Rolling over a pension
Chapter 16 Getting Insurance
Building a Health Insurance Plan
Unlocking the health savings account
Understanding Medicare supplemental plans
Exploring the exchanges
Considering long-term care insurance
Defending Your Money with Insurance
Checking property and casualty coverages
Getting ready for a rainy day: Umbrella insurance
Protecting your family with life insurance
Part 4 The Part of Tens
Chapter 17 Top Ten Retirement Mistakes
Waiting to Save
Ignoring Fees
Not Securing Your Information
Prioritizing College Savings Over Retirement
Not Diversifying Your Portfolio
Waiting for the “Right Time” to Invest
Having Inadequate Insurance
Taking Money from Your Accounts Early
Not Checking Your Social Security Benefit
Not Thinking about Income
Chapter 18 Top Ten Retirement Questions
How Much Money Do I Need?
Is Medicare Enough?
What Will I Do with My Free Time?
Will I Run Out of Money?
Should I Have a Roth or Traditional IRA?
How Good Is My 401(k)?
What’s an RMD?
Can Retirement Rules Change?
What Can I Do If I’m Near Retirement Age and Don’t Have a Plan?
Do I Need a Financial Advisor?
Index
EULA