Smart Retirement Planning For Every Age

Solid planning and the right safety net will ensure that you enjoy your golden years

disciplined person could be tempted to spend, spend, spend. Wright says consider purchasing prepaid spending cards, say $300 a month, for miscellaneous items. “Not only will you be forced to stay within that limit, you can get a printout of your purchases, which will help you track where your money is going.”

The Advice For Your 20s
When you’re in your 20s, you can take more risk because you have the luxury of time on your side. You can afford to ride out the market’s bumps because you won’t be touching that money in the near future. With this in mind, and Spencer as an example, Wright recommends an investment portfolio comprised completely of stocks: 30% large-growth, 30% large-value, 5% mid-growth, 10% mid-value, 10% small-value, and 15% international stocks.

“This is designed for the highest risk tolerance investor with a long time horizon. Investors with this kind of portfolio will look to achieve the highest return potential, but should understand that there will be the possibility for high fluctuations in market values,” Wright says.

With that said, go for it. You have time to make up any losses, and you have many years of earning power ahead of you.

30s
“My retirement goals are pretty simple,” Dennis White says. “By the time I reach 62 years of age, I would like to have at least $10 million in assets and to have real estate and other investments that provide a return of at least $250,000 annually.” White, 39, and his wife, Tiffany, 31, have their work cut out for them if they plan to retire with $10 million.

The Flossmoor, Illinois, couple has $92,000 in an IRA, which includes the $32,000 Dennis received from a defined benefit pension plan that was offered by his previous employer. Tiffany has $11,000 in a 401(k) and a separate IRA with more than $6,500 in it. And the Whites have a four-unit rental property that brings in $400 a month.

White, a real estate and franchise attorney, worked as an in-house lawyer at General Motors before joining the law firm of Holland & Knight. He left Holland & Knight last October to open a Century 21 franchise. He already had a real estate company on the side but figured that, given his legal background and experience in real estate, he could “kick butt” with a franchise.

But he’s not doing so just yet. Getting the business off the ground has exhausted $40,000 of White’s savings and led him to rack up $10,000 in credit card debt in less than six months. The franchise fee alone was $25,000. Then there were desks, computers, cabinets, and other equipment to buy.

Before White left Holland & Knight, the family’s household income was about $200,000. He expects it to go down this year to about $150,000. He was mainly responsible for taking care of the household expenses, which total around $7,000 a month. Now, with his drop in income, meeting that obligation hasn’t been easy.

White says the family has had several “false starts” trying to stick to

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