Ready, set, retireWritten by Nolan Baker Mark Clair | | firstname.lastname@example.org
Toledo jobs are still hard to find as unemployment levels continue to hit record highs. According to the most recent numbers posted by the Bureau of Labor Statistics over 44,000 Toledoans suffer from unemployment. That is a 10 percent increase from the month before with 13.6 percent of the work force without a job.
On the other hand, many investment accounts have dramatically increased in price in the past year as the stock market has made a record come back after the bear market lows in March of 2009. Spring is here, it’s time to get out and enjoy life and many people have started to become more comfortable again with retiring. But, before the paperwork is signed, know which options have deadlines and which options give you more time.
The retirement package is full of irrevocable decisions on options about retirement and insurance plans. Two different people recently came into our office and found out too late they picked what could turn out to be the wrong option with their retirement accounts. Now, their retirement account is locked up and they no longer have access to any of the principal. Their decision is irrevocable and no matter how much we would like to help them it’s too late. If they die before their spouse, their spouse could be forced to go back to work!
Ken, on the other hand, came into our office with his retirement papers and we sat down together with him and his wife and spent a couple of meetings crunching the numbers before we submitted the paperwork. In his case, we noticed that he had 30 days from the date of his retirement to apply for insurance benefits without having to provide updated health information. This is what is called a conversion period on his group life and long term care insurance policy.
That meant he wasn’t required to tell the insurance company about his recent heart attack and was able to purchase a personal life and long term care insurance policy at a reasonable rate. Had we missed this option before the 30 days expired, he most likely would not have been able to purchase personal life or long term care insurance on his own due to his recent heart attack. By coming in right away, we were able to work together and make sure we got the insurance paperwork in before the deadline expired.
Like most people who retire, Ken also wanted to get the retirement paperwork in right away too so he could get his first retirement paycheck. He had a variety of different options. He could take an income for his life, a little less for him, but a survivorship option for his wife, a lump sum option, or a variety of other choices. Since there wasn’t an immediate deadline on this paperwork, we showed Ken how he could take money from other investment accounts for his current income needs, giving him time to allow us to work up a plan on his retirement options. With his health problems, we advised him to take a portion of his retirement in the form of an income for his and his wife’s life, then roll over the rest of the money into an IRA.
This IRA gives Ken the flexibility to invest in stocks, bonds, mutual funds, annuities, bank CDs or any combination of choices that is right for him, giving him control of his money. These funds will be used for different things that come up in life, like buying a new car, taking vacations, helping family out, or whatever he desires.
The great thing about retirement is everyday can become a weekend. Just pay careful attention; some decisions need to be made right away, and others you should take some time on. Read over all of the retirement and insurance information that is provided by your company and get a good understanding of everything.
Since this is one of the biggest decisions of your life and involves irrevocable choices, don’t be shy about asking for professional help. Review the pros and cons of each option and make an educated decision. Be like Ken and leave luck for catching the big fish in the walleye run, and have a plan in place for retirement.
Securities are offered through NEXT Financial Group Inc., Member FINRA / SIPC. The Retirement Guys are not an affiliate of NEXT Financial Group. Their office is located at 1700 Woodlands Drive, Suite 100, Maumee, OH 43537.
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