You’ve probably heard the startling statistics: more than 80% of people are either dead, or dead broke by the age of 65. If that doesn’t have you sitting up and paying attention, then nothing will. The fact is you need to start planning now, no matter how old you are, in order to assure you are part of the 20%, not the 80%. Too many people depend on the government or their company’s pensions to survive. Sadly, in today’s world that just isn’t enough. You need to increase your investments and get a good return on them so you can have a steady income when you retire. Even just $500 a month for 10 or 15 years can assure you of a comfortable retirement. Luckily, there are strategies you can put in place starting today to increase your chances of living comfortably in your golden years.
Cut down on your expenses: Cut down on eating out; buy clothes that don’t need to be dry-cleaned; grow your own vegetable garden; shop around for better health insurance rates (without compromising proper coverage;) buy things when they are on sale, or in bulk. There are hundreds of ways to cut down on your expenses. Find them, and then implement a plan and stick to it.
Increase your income: Find a better paying job, or work at a second one, at least for a few months or a year; find a business to start online that pays you an affiliate income. Try freelance writing for some extra income or get involved with a network marketing company. Don’t start a business that is going to cost you hundreds to get started; you can find many that have little or no overhead.
Sell some of your stuff: You probably have a few things around the house you’d like to get rid of. This isn’t about having a garage sale and selling old books and knick-knacks. Perhaps you have some furniture you don’t use anymore, or gym equipment. What about those expensive tools in the garage that you haven’t used in years? Have a look around and take inventory of things you can sell. Put an ad in your newspaper or online directory.
Now that you have found some cash, it’s time to choose how you’re going to invest it. The best thing for you to do is to talk to a qualified investment adviser. They will sit down with you and go over your goals and your current situation. They will be able to recommend an investment strategy that will help you get to where you want to be in the shortest time possible. Don’t just talk to one or two; interview at least three and choose one that you are the most comfortable with. Don’t be afraid to ask them questions and make sure they know what they are talking about. Are they just in it for the commission, or do they have your best interests in mind? A good financial adviser will go a long way towards you living comfortably and with dignity in your retirement years.
Johnny Guyzer has 8 years of experience working as a financial consultant and has an undergraduate degree in economics, so he has a thorough understanding of how to manage personal finances. Johnny recommends using an insurance comparison service online to compare quotes offered by various insurers to get the lowest price for Canada life insurance.
A SEP IRA is a very popular retirement plan especially for the small companies or those of us who are self-employed. Some may ask “What is a SEP IRA? What makes it so popular?”
A SEP is a retirement plan tailored for those who own small businesses with a small number of employees or a self-employed individual. Because this retirement plan’s target demographic involves those companies or individuals who do not have a huge income capable to sustain a high priced retirement plan, the terms of a SEP are very flexible, while giving the same benefits to employees as a traditional IRA.
Employers are the one who setup the SEP plan. Employees are responsible for their own individual IRAs where the contributions of the SEP will go to.
In this retirement plan, only the employer is allowed to make contributions to the SEP. Any contribution made cannot be taken from the employee’s salaries. Though it may seem like the employer is at the losing, end that is not the case. Contributions made by the employer are 100% tax deductible.
When it comes to contribution limits, the maximum possible contribution is the lesser of $49,000 or 25% of the annual salary of the employee. Contributions and benefits given must be equal for all employees involved in the SEP.
The beauty of this plan is in its flexibility. Employers can choose when and how much they want to contribute to the SEP. So if business is not doing well, they can choose not to make contribution now, or just give a lower contribution. If profits are up, then the employer can take advantage of the high contribution limits for a bigger contribution to the SEP.
Ina small business where time, budget and resources are limited, flexibility is important. A SEP IRA gives a business owner all the flexibility he or she needs to provide the employees with retirement plan benefits without putting the business in jeopardy. It’s also convenient because employees can do a 401k rollover into the SEP plan which ensures their retirement funds keep growing.
Make sure you have all your W-2 Forms before you file your 2010 tax return for this year because you will need all of them. You should have gotten a Form W-2 in the mail from each and every one of your employers for the year. The deadline for the employers to get them out to you is January 31st, so wait until then before you begin to worry.
If after that date, you do not have your Form W-2:
Call up your employer. Ask them if they sent out your Form W-2. If they did, make sure that they have your correct address. If they send you another W-2, wait for a reasonable space of time to receive the paper.
Call the IRS. If by February 14th, you still have not received the Form, then you should call the IRS toll free at 800-829-1040. When you contacting the IRS, you will need to give them information such as your Social Security number, your address, your phone number, and of course your name, as well as:
• Your employer’s contact information (name, address, and phone)
• The dates you were employed by him or her
• An estimate of how much you earned for that year, and an estimate of the amount of money withheld for your federal income taxes, your dates of employment. These numbers can be obtained most accurately by looking at your final pay stub or consulting your a leave and earnings statement if you have it
File for your tax return. Yes, even without the needed Forms, you still have to file your tax return (or for an extension) before April 18th. Just use Form 4852 instead as a replacement for the missing Form W-2. Send Form 4852 with your tax return and your most accurate income and withheld taxes information. This may delay your tax refund while they verify that your form is indeed accurate.
File a Form 1040X. If you do eventually receive your W-2, but you have already filed for your tax return, compare the W-2 numbers with the numbers you filed. If they do not match up, obtain a form 1040X to file a revised tax return.
The mentioned instructions and forms and instructions can be obtained from IRS.gov website or by calling 800-829-3676