Faith Based Investing

It only makes sense – yet many retirees live without one.

You won’t be able to withdraw an unlimited amount of money in retirement. So a retirement budget is a necessity. Some retirees forego one, only to regret it later.

Run the numbers before you retire. Often people need about 70-80% of their end salaries in retirement, but this can vary. So years before you leave work, sit down for an hour or so (perhaps with the financial professional you know and trust) and take a look at your probable monthly expenses. Online calculators can help.

The closer you get to your retirement date, the more exact you will need to be about your income needs. You first want to look for changing expenses: housing costs that might decrease or increase, health care costs, certain taxes, travel expenses and so on. Next, look at your probable income sources: Social Security (the longer you wait, the more income you can potentially receive), your assorted IRAs and 401(k)s, your portfolio, possibly a reverse mortgage or even a pension or buyout package.

While selling your home might leave you with more money for retirement, there are less dramatic ways to increase your retirement funds. You could realize a little more money through tax savings and tax-efficient withdrawals from retirement savings accounts, through reducing your investment fees, and getting your phone, internet and TV services from one provider.

If you have just retired or are about to, you will enter 2012 with some financial breaks. Social Security benefits will increase by 3.6% next year, Medicare Part B premiums will only rise $3.50 instead of the $10 that Medicare projected, and the Part B deductible will be $22 cheaper in 2012 ($140).

Budget-wreckers to avoid. There are a few factors that can cause you to stray from a retirement budget. You can’t do much about some of them (sudden health crises, for example), but you can try to mitigate others.

• Supporting your kids, grandkids or relatives with gifts or loans.
• Withdrawing more than your portfolio can easily return.
• Dragging big debts into retirement that will nibble at your savings.

Budget well & live wisely. These are times of low interest rates and modest Wall Street gains. Given those factors, creating a retirement budget makes a lot of sense. A budget – and the discipline to stick with it – may make a financial difference.

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is not a solicitation or a recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Looking forward to retirement?

Almost everyone is looking forward to retirement. After working almost all of your life, you would finally get the freedom from all the tedious and stressful work you have been keeping all these years. As your officemates throw you a fabulous farewell party, you could start sitting back and planning for much deserved vacations and trips around the globe.

Retirement could be synonymous to freedom for most people. You would not have to be tied up to any job anymore. As mentioned, the moment you spend your last day working, you could be thinking about traveling. You may also consider many other fun and leisure activities, which could be quite costly.

By this time, you could be raving because you have a huge amount of savings in your bank account. You may also start claiming from your retirement plans. Do not forget that what you have now is all you have. There is a need to make it last your lifetime, which could be 10 years, 20 years, or even 30 years more. While it is just ideal to enjoy planned vacations and shopping sprees, you still need to observe several restrictions especially when it comes to your personal finances.

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American Jobs Act?

On September 8, President Obama announced a new plan to improve the economy – the $447 billion American Jobs Act, a sequel of sorts to his past economic stimulus proposals. His announced goal: job creation without new taxation.

While the President took some sharp jabs at Republicans in his speech to Congress (“I know that some of you have sworn oaths to never raise any taxes on anyone for as long as you live”), early indications are that the bill will have noticeable bipartisan support.

What’s in this bill?

The AJA would try to boost the economy through seven different tactics – extensions and expansions of tax breaks, and infusions of federal dollars.

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We’re off to see the wizard . . .

Debt ceilings, credit downgrades, and a collapsing market oh my!  Feels a bit lately like the U.S. is having a bad dream.  Like we woke up in Oz and the Wicked Witch took over.  Wake me up from this nightmare!

Many politicians probably wish they could click their heels and make it all go away.  The truth remains that our fiscal problems are here for the long haul unless urgent changes are made.  When you borrow from Peter to pay Paul, as it is in life, choices have consequences. The U.S. is now facing some tough times ahead because of poor choices…

Let us quickly get up to speed on where we are:

1. First we battled over raising the debt ceiling.

The August 2nd debt ceiling deadline came and went as the Treasury reassured  the world financial markets that U.S. would not default on her debts. This was too close for comfort!  When all the dust finally  settled, it  was determined by the non-partisan Congressional Budget Office that the federal deficit will be reduced by at least $2.1 trillion. Yet it is still uncertain where the majority of these cuts will be made.

We will definitely see defense and non-defense programs reduced by $741 billion over a 10-year period, which includes a $350 billion cutback in defense spending at the Pentagon. There will be an additional $156 billion in savings from lower interest costs on servicing our existing National Debts.  Another $20 billion will be cut from education loan initiatives and through efforts to identify fraud and abuse in other mandatory federal programs. (Student loan funding will be reduced to $22 billion by 2021, but Pell Grant funding will increase by $5 billion by 2015.) A bipartisan committee of 12 will have to recommend between $1.2 trillion and $1.5 trillion in additional federal budget cuts by November 23rd.

This bi-partisan committee will be responsible for looking at Social Security,Medicare and Medicaid and any other line items that can add some bang for the buck. The committee consists of :

• House Minority Leader Nancy Pelosi (D-CA) & Senate Majority Leader Harry Reid (D-NV)  who will each get to select three Democrats.
• House Speaker John Boehner (R-OH) and Senate Minority Leader Mitch McConnell (R-KY) who will each get to pick three Republicans.

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What factors need to be in place for this to happen?

What will it take for the housing market and employment to really improve? It really boils down to the two greatest economic factors of all: supply and demand.

What needs to happen in the labor market? Ideally, a swift rise in consumer demand for goods and services in 2011 spurs businesses to hire, with no need for another costly federal stimulus. About 125,000 people enter the U.S. labor force every month, so job creation needs to hit that level just to tread water in terms of employment–to-population ratio. Data from the Brookings Institution shows that 280,000 new positions emerged monthly at the peak of job creation in the 2000s. Back in 1994, the economy was creating an average of 321,000 new jobs a month.

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