Are you 50 and just now starting to save for retirement? Worried that your retirement may not be exactly like you planned? You’re not alone. According to a study from Gallup, retirement is America’s top financial concern. More than 50 percent of Americans are worried that they will lack money for retirement.1
 
There may be good reason for concern. A study from the Economic Policy Institute found that the median retirement savings for American working families is just $5,000. Among those between ages 50 and 55, the median savings is $8,000.2 So while you may feel anxiety about your retirement planning, you’re not the only one in this position.
 
The good news is it’s never too late to make adjustments and start preparing for retirement. Below are a few tips to help you get started. You also may want to consult with a financial professional. They can help you develop and implement a strategy.

Stick to a budget. 

Do you use a budget? If not, now may be the time to start doing so. Nearly a third of American families don’t use a budget, even though it’s a powerful and helpful financial planning tool.3
 
Your budget can help you make smart purchasing decisions and save more money. You can use an app or software or even a simple spreadsheet. Simply list all of your spending categories and then look for areas where you can make cuts. The key is to update your budget, stick to your spending goals and contribute your extra cash flow to savings.

Use catch-up contributions. 

Does your employer offer a 401(k)? Do you have an individual retirement account (IRA)? These types of accounts are powerful retirement savings vehicles because they are tax-deferred. That means you don’t pay taxes on growth as long as the funds stay inside the account. That may allow your assets to compound at a faster rate than they would in a taxable account.
 
Starting at age 50, you can contribute more money to these accounts through something called a catch-up contribution. A catch-up contribution is an extra allowable contribution amount for those approaching retirement.
 
In 2019, you can contribute up to $19,000 to your 401(k) plan. However, if you’re 50 or older, you can contribute an additional $6,000, bringing your total allowable contribution to $25,000.4 You can contribute $6,000 to an IRA, plus an additional $1,000 if you’re 50 or older.5

Consider delaying retirement. 

If you’re just getting started on saving for retirement, you may want to rethink your retirement age. There’s benefit to delaying your retirement. Every year you wait to retire, you give yourself another year to save money. You also eliminate a year of retirement that would have to be funded by savings.
 
There’s one other benefit to delaying your retirement - you could get more from Social Security. You get your full Social Security benefit when you retire at your full retirement age (FRA), which is between 66 and 67 for most people.6
 
However, you don’t have to file at your FRA. You can delay your filing. If you do, Social Security will credit your benefit amount by 8 percent for each year you wait. The credits stop at age 70. However, if your FRA is 66 and you delay your filing to 70, you could earn a 32 percent bonus on your benefit.7

Protect your assets. 

Finally, you may want to consider a strategy that minimizes your exposure to risk. As you approach retirement, you have less time to recover from a market downturn. It’s important to grow your assets, but it’s also important to reduce threats like market volatility.
 
A fixed indexed annuity (FIA) could help you do just that. FIAs pay annual interest based on the performance of a market index, like the S&P 500. The better the index performs, the more interest you may earn, up to a limit. If the index performs poorly or loses money, you may earn less interest. However, you never lose money due to market losses. An FIA could be an effective protection strategy for a portion of your assets.
 
Ready to kickstart your retirement planning? Let’s talk about it. Contact us today Marshall Life and Financial Solutions, Inc. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
 
1https://news.gallup.com/opinion/polling-matters/260570/despite-economic-success-financial-anxiety-remains.aspx
2https://www.cnbc.com/2017/04/07/how-much-the-average-family-has-saved-for-retirement-at-every-age.html
3https://www.prnewswire.com/news-releases/fewer-americans-are-budgeting-in-2019----although-they-think-everyone-else-should-300824384.html
4https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-401k-and-profit-sharing-plan-contribution-limits
5https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-401k-and-profit-sharing-plan-contribution-limits
6https://www.ssa.gov/planners/retire/retirechart.html
7https://www.ssa.gov/planners/retire/delayret.html
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.

It’s that time of year again. Time to hit the stores for back-to-school deals. If you have kids in school, you probably have a long list of colored pencils, notebooks, markers and other supplies. Perhaps you need to get your kids shoes, a new backpack and even new wardrobe. And you can’t forget the back-to-school haircut.
 
This is the season when we make sure our kids our prepared for the upcoming school year. However, it’s always a good time to make sure you and your kids are prepared for financial challenges that could arise. Life can be unpredictable. The best way to minimize risk is to prepare for possible emergencies, no matter how small the probability.
 
Life insurance is one effective protection tool. It may seem unnecessary for children, but there are a few important benefits. Below are some reasons why you may want to consider life insurance protection for your kids:
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It provides financial protection for final expenses. 

It’s never pleasant to think about death, especially involving a child. The probability of a child passing away is usually fairly slim, especially for children who are relatively healthy. However, the fact remains that children do occasionally pass away. Accidents happen. Illnesses develop. These things are unfortunate realities.
 
Life insurance provides a tax-free death benefit upon the insured’s passing. You can use that benefit to pay for final expenses, medical bills and any other costs that may arise as a result of the death. While it may be morbid to consider the possibility, life insurance can ultimately minimize the financial fallout related to an already tragic situation.

It’s usually affordable. 

Life insurance costs are generally driven by the risk of the insured. The more likely it is that an individual will pass away soon, the higher the cost tends to be. Insurance companies analyze age and health to make this determination.
 
Children usually fare well in this analysis. They’re young in age, which obviously reduces their likelihood of passing away. If your child is generally healthy, that also works in their favor. Very often, you can purchase life insurance coverage on a child for minimal cost. A financial professional can help you compare policies and premiums.
 
It locks in coverage for later in life. 

When you purchase life insurance, the insured must go through a process called underwriting. This is an analysis of the individual’s health to determine their risk. For older individuals, underwriting can be a complicated process. However, for children, it usually involves a review of medical records and perhaps a simple physical.
 
One of the benefits of owning life insurance is that you usually only have to go through underwriting one time. As long as you own the policy, you have guaranteed* coverage, which means you can increase your coverage amount at any time without going through underwriting again.
 
This could be an important benefit for your child later in life. If they develop a health issue that increases their risk, they can still obtain coverage through the policy you bought them as a child. And they can do so without going through underwriting.

It serves as a savings vehicle. 

Many permanent life insurance policies have something called a cash value account. When you make a premium payment, a portion of the premium covers the cost of insurance. The remainder is deposited into the cash value account.
 
The cash value account grows on a tax-deferred basis over time. The method of growth depends on the type of policy. Whole life policies pay annual dividends. Universal policies pay interest. There are even variable universal life policies that allow you to invest in the financial markets.

Ideally, you’ll never have to use the death benefit feature of the policy. When your child grows up and assumes ownership of the policy, they can either continue the coverage or use the accumulated cash value to help them reach their financial goals. The policy can serve as a tax-efficient savings vehicle as they grow up.
 
Ready to explore life insurance options for your child? Let’s talk about it. Contact us today at Marshall Life and Financial Solutions, Inc. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
 
*Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values.
 
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.