Planning Tips for Retirement

six three seven. I'm gonna be talking about wrapping up the year and some retirement goal planning with Malia and Kyle this morning. Don't forget though, if you have any questions related to retirement. Of course, they are our retirement planning professionals from Class Financial and they are here for you. I just pick a phone, give us call six oh eight three two one thirteen ten. That's six oh eight three two one thirteen ten. I'll get you on the

air with folks from Class Financial. Speaking of our friends from Class Financial, Malia, how are you doing this morning?

Financial dot Com. Also great feature of the program is the class Quiz question the week. Your chance to win a fantastic prize this week is no exception. You have a chance to win a twenty five dollars gift card to Cheesecake Factory from our friends at Class Financial. And before we get to our conversation about retirement goal planning as we ring in the new year, let's actually talk about last week's class Quiz question week get the question and answer there as well.

The results were tremendous out there, So congratulations to our winner from last week who correctly answered that that was Rachel of one on a key. So listen carefully. Today's question for the price.

of the air. Of course, twenty twenty five is nearly here. Are there retirement goals that we should probably be doing right now, Kyle planning.

So today we've got some great ideas to help you start out on the right foot, but really to before we get into twenty five, the first thing that we should do is look back at what we where at today and what went on. Obviously, So the first one is to assess your current debt. Excuse me, so, as Malia said, sometimes around the holidays, people spend a little bit extra on those Christmas presents and things like that.

So you got to include any of this that you may have just accumulated over the holidays here and really understand the amount of interest you're paying to hold onto that debt, because again, credit cards tend to be really high interest. But also look at your mortgage debt and does it make sense to make an extra payment or two per year, as you've heard us talk in the past. By doing that extra mortgage payment a year, that really cuts down on the time that you're paying on that mortgage.

It's pretty pretty wild when you look at the big picture of it. And then can you another year to avoid a higher car payment? So obviously, car companies are really good about running good advertisements this year with special financing and all that kind of stuff to kind of tempt you into this. But if yours is doing fine, does it make sense to hold onto it for a little while longer to keep those payments lower. Obviously, and with debt obvious just comes your overall monthly budgets. Does

your paycheck go every month? Is it going to just debt? Do you have so many bills out there that you don't feel like you've got a lot left over? Is it going towards something that you're not even conscious of? Right, so going out to eat a few times more than you realize, or spending a little more when you do go out those types of things, and then understanding where you and your household spend your income every month, will

all properly allocate funds towards something beyond just today. So this is something that we always, you know, want to want to be conscious of and make sure we know

where every dollar's going. Obviously, talking this small number three would be review your emergency savings account, so again make sure you have to you have a plan to have at least that three to six months is kind of the gold standard that he's shooting for, but it can always go up a little bit like that, and it's really a good good time to see if there's any adjustment you can make to start saving a little bit more here and there. And then reviewing your retirement account.

So a lot of times you want to look at how much you put away last year and then did you take advantage of the full company match, and can you improve upon this in twenty twenty five by simply increasing your percentage. So this is one of those little things that we try to get people to do, is that a lot of times, as you go into the new year, you'll likely get a raise or something like that,

and you should be taking part of that raise. And even just increasing your four to one K contribution by one or two percent, you may not even feel it on the paycheck, go a long way over the long term for you talking this morning with it. And then obviously when you're putting into the retirement accounts, you've got to be aware of what the contribution levels are. So these tend to adjust every year, and in twenty twenty

five they're going to be going up slightly. So it's going to be going up to twenty three thousand, five hundred for just a regular four oh one K or four h three B planes that are under age fifty. But remember if you're over age fifty, you get a catchup of seven five hundred dollars this next year, so you could be putting in a toll of thirty one

thousand if you're over the age of fifty. And now there's a new little wrinkle that we have to be aware of that if you're between the ages of sixty and sixty three, they've actually come out with an extra catchup contribution, if you want to think of it that way, to get your total catchup to eleven thousand and two fifty.

So the most that you could be putting in as a sixty, sixty one, sixty two, or sixty three year old is actually a thirty four thousand and seven to fifty, not that thirty one thousand for people under the age of sixty. And remember these are four to one k contributions that I just talked about, But IRA contribution levels

are a little bit different. So IRA contribution levels in twenty twenty five are going to be the same as they were in twenty twenty four, which is seven thousand dollars for people under the age of fifty and one thousand dollars catch up for those over the age of fifty, so you can put a total of eight thousand and

if you're over the age of fifty. Nice. And then finally, the one big thing that sometimes people forget about these, and they're really really powerful accounts where big fans of these, which is a health savings account, So these are associated if you have a high deductible health plan through your employer or if you're on the exchange and a high deductible health plan. This is an account that you can do. It's a health savings account. As I mentioned, that's tax

advantage way to save money. So this is what we call triple tax preferred here, so HSA contribution. So the money you put in actually reduces your tax will income. And then you can invest HSA funds. A lot of people leave them sitting in like a cash money market savings account type thing, but you can actually invest them if it's at the right custodian and if you if the investment grows, you're going to get tax free growth on that. And then as long as you pull it

out for qualified medical expenses, it's actually tax free. So again that's the triple tax I was talking about. You get the deduction when you put it in, it grows tax free, and it comes out tax free as long

as you use it for qualified expenses. And in twenty twenty five you're gonna be able to put aside as much as forty three hundred bucks for an individual and then eighty five fifty for a couple or a family with an extra thousand dollars catch up if you're over the age of fifty five, So again about fifty three hundred or ninety five to fifty if you're over the

age of fifty. And another good thing about these is even if you do them for medical expenses, once you turn sixty five, they basically become another IRA and that you can pull the money out and you just have to pay the income tax on it, but you don't have to pay the penalty because if you take it out for non qualified medical expenses, they do penalize you, so you want to make sure you're using it for

that if you can. But once you get over sixty five, that penalty goes away, which is a nice little thing to have with those as well.

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with COSS Financial. Of course, you can always call their office right here in Madison six ' oh eight four four two five six three seven. No charge for that initial get to know your apployment Tech Loss Financial. It will be complementary to you again that telephone number six oh eight four four two five six three seven. We'll get some details on some of the other things you should be considering doing when it comes to retirement goal planning.

As we look towards twenty twenty five, with Malia and Kyle, we will do that next as Money in Motion with Coss Financial continues right here on thirteen ten. WIBI joined this week by our retirement planning professionals from COSS Financial, Malia Quavis and Kyle Kite. Of course, you can learn more about everyone at COSS Financial, including Malia and Kyle if you head on over the website cossfinancial dot com that's Coss Klaasfinancial dot com. Under the about tab you

can get to know the team there. Speaking of being at the website, a lot of fantastic information about class financial things about their separate divisions. Also chance to sign up for the weekly Market Pulse newsletter that available to you at Cossfinancial dot com. There a telephone number office right here in Madison six' oh eight four four to two five six three seven. No charge for that initial

get to know your appointment tech Loss Financial. It will be complementary to you again their number six oh eight four four two five six three seven. Looking this week towards twenty twenty five, talking about retirement goal planning and Malia as as we're kind of going through some of these steps, I've got to guess there's a lot more here. Are there some other areas we should be considering when it comes to planning and of course getting ready for retirement.

and see what has happened this year. If you don't have a financial advisor you're meeting with, certainly do this on your own and really reflect how your investments have performed. And perhaps they're out of they're out of whack at this point. And I mean that in a good way, because what we've seen is a lot of growth in certain sectors and you may be needing to rebalance so that your strategy is what it should be at this

point in your life. So really take time to make sure that you are allocated the way you should be for risk and then also looking at your time horizon. So many people are like, yeah, I mean, I'm not going to retire for fifteen years, well, that obviously might not be quite as important as someone retiring in five or two. So you really want to understand, you know, your situation and how much risk you should have out there on the table. Many people we've had shows about this.

Many people are heavy in their own company stock. Nothing against your current company, whoever that may be. I'm sure they're high performing and that's great, and I'm sure when there's a great year, you believe that will always be the case. Same with certain certain stocks you might hold individually. But what we've seen is, especially when we're planning for retirement, we don't want that much risk concentrated in one single stock.

And sometimes that happens without you even realizing it because as you do retirement contributions, those come in the form of company stock. So you really want to take us a good look at what is compiled in your current four oh one K or four oh three B. So again, as you get closer to retirement, it's important that your allocation matches up with your goals and timelines. The next item we want you to do is put together a net worth statement, So you want to take time to

carefully review your bank and investment statements. Tally all your debts, I know that's the one. We'll gulp it and your savings, put it together. And what you're gonna do is you're gonna take your assets minus liabilities and determine your net worth. Now assets do include your home and your car and so forth, plus your investments, and then we subtract out your liabilities that would include of course some mortgage, car loans,

personal loans, and of course credit card debt. And what we want to do is kind of try to stay on track from you know, quarter to quarter to make sure we are slowly decreasing that debt and hopefully increasing the assets, whether it be savings or savings in your bank or certainly your retirement savings. It's really important to know where you're at. And you know, speaking to my daughter the other day and I said, well, so have

you looked at your four one K this year? And she's in her twenties and she goes, she goes, I can't. I'm not going to look at that because I know I can't touch that yet.

You can get a statement online and that will give you information about your earnings records, your estimated benefits, and how much you or your family would receive in disability, survivor or retirement benefits. So you know, we have our clients do this on a regular basis. They no longer send out those nice little statements unless you request it,

but typically just go online. You can see what your benefit's going to look like at your full retirement age, which, if everyone's listened to our show enough years, that's known as your FRA. And you know we also talk about you might want to hold back and not collect at your FRA. You might want to wait till age seventy, so those delayed retirement credits start adding into your future benefit.

And those delayed retirement credits are as much as eight percent per year from that FRA up to age seventy, So you want to understand because social security for most people is going to be a good portion of their future income. We also want you to review your beneficiary, so we want to make sure all your investment accounts reflect who should receive your assets if you're no longer here. You want to make sure your will or your trust

also reflect the same beneficiaries. And then we also want to want to make sure you have your power of attorney documents in place, so that would be power of attorney for property meaning investment assets as well as real estate and other assets. We also want you to have your health power of attorney in place so people could speak on your behalf if you were unable to, so

make sure you do that. We would say review your beneficiaries on a yearly basis because things change in families and we want to make sure that your wishes are carried out as you would like them to be.

the policy? And what we hear many times is people say, well, I've been putting I've been paying my premium for fifty plus years, and I don't want to stop paying it. But then we look at really the details again and go does it make sense to be keeping it for that amount of death benefit? Or better yet, can we actually take that cash value and apply that towards the premium at the very least, So you really want to look at does that make sense to keep the policy

in place? Please, please, please do not go out and cancel these policies until you've reviewed them with somebody. But you also want to make sure that you have beneficiaries on those policies that still reflect your current life. And then finally we're going to say, you know, we're big planners here, so we want you to begin goal planning for your retirement. I don't care if it's fifteen years, twenty years out, or five years. We want you to

start planning. So when do you ideally want this to happen? Obviously that's a moving could be a moving timetable for you. Where would you want to live in retirement? How much money do you need to make that a reality? Again, you're going to sit down, hopefully with a financial planner at some point and say, okay, tell me what do I need and how am I going to get there? And so with that, they will tell you what steps you need to take today to reach that tomorrow, which,

believe it or not, is just around the corner. So we just would say slow down, we'll assess where things are at today so you can get to that future.

oh eight four four two five six three seven. We'll do the class quiz question so weak walls to take it down the home stretch with Kyle. We will do that next as Money in Motion with Coss Financial continues right here on thirteen ten Wibi, it's money in Motion with Coss Financial. Don't forget about the website class financial dot com. That's Coss Klaasfinancial dot Com. They're telling phe number six so eight four four two five six three seven.

Talking this week with Malia Quavis and Kyle Kite, talking about planning when it comes to retirement planning. Of course, this time of year, a lot of us putting things into perspective with the new year upon us, twenty twenty five will be here in no time. And had some great tips so far, and Kyle continuating along with that, there are some things that we should be keeping in mind as we plan for retirement, aren't there?

almost always help reduce stress. So most people, if they have grandkids, that's going to be a big part of it. They want to be able to chase them around and all that kind of stuff. But also exercise in your mind as well, so puzzles, doing all kinds of stuff, and socially too, get out with friends, those types of things that all leads to a fulfilled retirement. And you know, find a hobby. So if you already have one, great, spend some more time on that and things like that.

But if not, take a class or try something new, because retirement may just be a few years away. You want to start figuring out what the next bring. Right now, a lot of people are picking up pickleball, it feels like all of our clients have gotten into this thing. So's that's a good one to keep moving and obviously meet some great people too. And then another one is to just evaluate your current job. So is your job

creating each stress? Is it time to find a new job, and do you need to find a second job to get your debt paid off sooner? So, like I said so many times, where we're working with people that are close to retirement, and if you've got your nest egg built and you know you're looking really good for retirement, you may just want to kind of take your foot off the gas, but not fully retire, and just find something a little less stressful for the last few years

of your career, honestly. Also, speak to your partner about your joint financial situations mean that you can't have separate bank accounts and some separate goals, but it's at least good to all be on the same page so that you guys know what you're working towards and what that retirement could look like in the future, and live within your means. So this is kind of where we started the show, which is stop unnecessary spending. So evaluate every purchase.

Is it a need or a want? Remember that debt makes everyone stressed and does not help you retire quicker. So this is one of the questions that we always get asked, you know, is how much do I need to retire? And that number looks different for everybody, because people that may not make a ton of money, but they're good at living within their means, they're good at sticking to a budget. They can have a very successful

retirement just because they've lived within those means. And meet with a financial advisor to bring together your questions and formulate a plan to accomplish your goals. And a lot of people like to do this on their own. And obviously you could find some great stuff out on the internet and YouTube and all that kind of stuff now, but all those answers that you're getting out there aren't

tailored to your specific situation. Nation is obviously going to be different than your neighbors or maybe even your closest friends. So you want to make sure that someone that you're meeting with an outside council that is making sure you're on the right track and accomplishing all those goals that you want to And finally listen to our Money and Motion show or our podcast, So we do this every Thursday.

We've been doing it for a lot of years now, and we obviously post all of these on our website, so we've got a lot of great resources on our website, and like I said, listening to just these shows play back, we've covered a lot of these topics that we just kind of clossed over today, but we do in depth shows on all of them that we've covered today.

Financial dot com. The telephone number for the officer right here in Madison six oh eight four four two five six three seven. No charge for that initial get to know you appointment at COSS Financial. It will be complimentary to you I got a telephon number six oh eight four four two five, six three seven. Go on and hold on to that telephone number now because it's time for the class Quiz question of the week. It works like this. In just a moment, I'll ask you the

class quiz question the week. We'll then have thirty minutes from the interday's program to call the COLSS Financial office right here in Madison at six oh eight four four two five six three seven. If you are the first caller with the correct answer, you'll win this week's prize, which is a twenty five dollars gift card to Cheesecake Factory. This week's COLSS Quiz question the week? Is this true or false? IRA contribution levels in twenty twenty five will

remain the same at seven thousand dollars. If you are under the age of fifty, Is that true or false? Telephone number six O eight four four two five, six three seven. First call quick ans went that twenty five dollars gift card to the cheesecake factory. Deffer gets, well, that's CSS Financial's office right here in Madison. No charge

for that initial gets Tony appointment at COSS Financial. It will be complementary to you again their number six O eight four four two five six three seven Melia Kyle, It's always great chatting with both of you guys.