Maximize Your Retirement Savings
Brought to you by PNC Investing and Retirement

Whether you plan to retire in two years or twenty, there are things you can do to get your retirement savings on track.

Which of the following is NOT a type of IRA?
You can’t contribute to a 401(k) and an IRA at the same time.
If you have multiple IRAs or 401(k)s from previous employers, what options might you have?
When can you make a catch-up contribution to your retirement accounts?
Your investment focus should change when you’re nearing retirement.

Right!

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Get Retirement Ready

Whether it’s six months away or 20 years down the road, you can do something today, or at least this week, to get ready for retirement. Just one thing. If your employer offers a retirement plan, join it, or increase your contribution just a little bit. If not, open an IRA or contribute to an existing one. That’s it.

Want to do even more? Check out the Next Step Guide to Retirement and we’ll make some suggestions.

GET THE NEXT STEP GUIDE

Session Q & A

  • NOW. It’s never too early to start investing for retirement, no matter how much you can afford to put away. If you start investing just a small amount in your 20s, you could wind up with more money than someone older who saved much more over a shorter period. The point is to start as soon as you can, and invest as much as you can. Even if you’re struggling with other obligations, try to set at least something aside for retirement.

  • Both retirement vehicles offer tax-deferred accumulation and have the same contribution limits. The main difference is that with a Roth IRA, you’ll pay taxes on the amount you contribute now, but qualified withdrawals will be tax-free in retirement. With a Traditional IRA, your contributions are tax-free, but you’ll be charged taxes when you withdraw the funds in retirement. Also, with the Roth IRA, you don’t have to start withdrawing funds when you reach a certain age, but with a Traditional IRA, you are required to start withdrawing a percentage of your savings at age 70½. Finally, while anyone can contribute to a Traditional IRA, your income must not exceed a certain limit if you want to make contributions to a Roth.

  • Different companies have different programs, so you should ask your employee benefits contact person to explain the specifics of your plan. There are two types of matching plans. Some employers will match a percentage of your contribution, while others match dollar for dollar. Both matches will have a specified limit (usually three to six percent of your salary). Either way, you should try to contribute enough to get the full match. Otherwise, you’re missing out on free money.

  • That all depends on when you plan to retire. If you have 20 years or more left until retirement, you’ll want to create a fairly aggressive portfolio to maximize your returns. With five or 10 years to retirement, a more balanced approach is recommended. And as you get closer to retirement, your key goal will be preserving your principal. Age-based or target-date funds are an easy way to get the mix of investments you need to meet your goals.

  • If you are self-employed, you may have more options than you think. If you work for yourself, consider setting up a SEP IRA, one of the most basic ways to invest on a pre-tax basis for retirement. With a SEP IRA, you can contribute as much as 25 percent of your eligible compensation, subject to IRS annual limits. Alternatively, a Solo 401(k) lets business owners set aside a significant portion of their earnings, because you can make contributions both as an employer and as a business owner, again subject to IRS annual limits.

Galia Gichon

Galia is a personal finance expert with 18+ years of professional experience, including nearly 10 years on Wall Street, and an MBA from Fordham University. Her company, Down to Earth Finance, offers individual sessions and seminars to address personal financial needs. Galia created the My Money Matters Kit, with tools including affirmations, tips and workbooks. She regularly guest lectures at universities, speaks at conferences and corporate events, and has been quoted by CNN, The Wall Street Journal, MSN Money and more.

Galia is a personal finance expert with 18+ years of professional experience, including nearly 10 years on Wall Street, and an MBA from Fordham University. Her company, Down to Earth Finance, offers individual sessions and seminars to address personal financial needs. Galia created the My Money Matters Kit, with tools including affirmations, tips and workbooks. She regularly guest lectures at universities, speaks at conferences and corporate events, and has been quoted by CNN, The Wall Street Journal, MSN Money and more.

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