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Can anyone tell me what the best Retirement Plans are today? I am 35 years old and am confused as to what kind of plan I should be looking at now. Although I am single, I plan to get married and have kids one day. Any suggestions? Any financial planners with a tax background please help me.

Financial Planning Retirement Savings Plans
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Tax Professional Answers

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Caran Ebert, CPA
Your best financial plan would be for you to go to a known investment company. There are so many variables investing in a retirement plan that you want to have a Big Name Company that has been in business for a long time to invest your money in. You need to discuss whether you want to pay your taxes as you are investing or defer your money until you are older and make less money so taxes are lower. You need to think about your future and a good investment broker will ask you if you plan to work for a company or if you want to venture out on your own. Do you need to withdraw some money before you are 59 1/2 so you can make a down payment on a house for example. How much money do you need to survive and how much can you afford to save? There are so many variables that a Big Name Company will ask you and you have to communicate any changes to your original plan so they can project what you may need for your future and not just for your retirement age. I would NEVER give my money to a so called financial planner because they are not looking at any big picture, they are just trying to make a commission on your business. My experience with retirement personally is never to place all your eggs in one basket. Your first concern should be to know how to budget your money; what do you need for each month and how much can you save. Second, you need to set aside at least 5 months of money in case of an emergency in a savings account that is readily accessible. Third, you should plan and save for a down payment on your first house because you should not be paying some else's mortgage payment as your rent does. And when you buy that house, making even $100 more than your actual payment to be applied to the principle will save you a fortune in interest charges and 10 years less on the time it takes to pay your mortgage off. Fourth, you should NOT USE CREDIT CARDS, if you can't afford it don't buy it and ever live beyond your means. A credit card is not free money, they are making a fortune in interest from you. BUY never lease a car and pay extra against that loan each month. Buy a certified used car that has low mileage and is about 2 years old so that you don't lose $10,000+ just driving off the dealer's lot. You don't break even until you pay off half the loan of a NEW car because of the depreciation. A certified used car usually has an extended warranty that you won't get with a new car. If you have children then you should next start saving for their education. I am really stressing that you do all the previous things before thinking about your retirement because if you take any money out of your retirement account before you are 59 1/2 then you will end up paying an additional 20% penalty in addition to the taxes owed when the money you take is added to your income for the year and puts you in a higher tax bracket. I regularly see people take money from their IRA or 401K and end up paying half the money they take to the IRS in taxes and penalties ($5,000 taken = $2,500 in taxes to IRS, state and penalties). When you have all of the previously listed items under control then you are ready to start saving for your retirement. Find a Big Name Company, ask your grandparents or parents for a reference. Chose stock 5 stock portfolios. There are so many that you are bound to find something that you have an interest in their cause in order to invest in. Some portfolios should be aggressive or risky that will make you good return on your money and some should be safe so that you will not lose your money and of course these will not pay a very high interest or dividend rate. Big Name Companies place a group of people to watch the portfolio fund of selected stocks and of course they aren't going to lose your money because they use your money to also make money for themselves. The group of people in charge of the fund watch every moment of the day and buy and sell within the portfolio so you don't pay for every stock purchase or sale. The Big Name Company will help you reach a dollar amount by diversifying your investments with the most money you can make until your targeted retirement age and your projected income needed after that date so you can live comfortably for the rest of your life. There are many formulas, actuarial tables, and planning they will put into your account. They should ask lots of questions and keep you informed of the changes each quarter and at least on an annual basis consult with you. Your tax professional should also be consulted with any major changes that you make during the year so that there are no surprises when it comes time to pay your taxes. Like buying a car you need to use for work or turning your home into a rental. Always consult with your tax professional BEFORE you make any major decisions. Thank you for asking about your retirement. I hope I have helped you start your future success.
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