To answer that question we analyzed data on four factors: unemployment rate, percentage of residents contributing to employer retirement accounts, cost of living and percentage of the population with employer health insurance.
First, we looked at the percentage of the county population that is unemployed. We then indexed the ratio to , with a score of representing the county with the lowest unemployment. Next, we calculated the percentage of the population contributing to retirement accounts.
We did this by multiplying the employed population of each county by the percentage of the population that have access to employee retirement plans, and then by the percentage of employees that participate in those plans. We indexed the final values to , with a value of reflecting the county where the most people who have access to employee retirement plans are contributing to those plans.
Then we looked at the cost of living in each county as a percentage of the average income in that county. We indexed these values to , with a value of reflecting that county where the ratio of cost of living to income is the lowest.
We then calculated the percentage of people in each county that have health insurance through an employer. We indexed these values to , with a value of reflecting the county with the highest percentage of the population covered by employer-sponsored health insurance.
Finally, we calculated a weighted average of the indices for unemployment, percentage of residents contributing to employer retirement accounts, cost of living and percentage of the population with employer-sponsored health insurance.
We indexed the final number so higher values reflect the best places for utilizing employee benefits. What is an Index Fund? How Does the Stock Market Work? What are Bonds? Investing Advice What is a Fiduciary?
What is a CFP? I'm an Advisor Find an Advisor. Your Details Done. My Details. Your location is used to determine taxes in retirement. Do this later Dismiss. Annual Income. We'll use this to estimate your taxes in retirement. This is used to figure out your age and the number of years before you retire. Retirement Age. Full benefits from social security are available at age 66 or 67 depending upon your birth year.
Annual Rate of Return on Savings. What do you estimate your annual expenses will be during retirement? We'll use this to figure out how much income you'll need to generate from your retirement savings. We'll take care of inflation so tell us based on today's dollars how much you think you'll need to support your lifestyle. Marital Status. Enter your marital status Single Married. Spouse Details. Enter your spouse year of birth Do this later Dismiss.
Spouse Income. Enter your spouse total pre-tax annual income. Annual General Inflation. Mutual fund: An investment that pools money from many investors to buy assets such as stocks or bonds.
Many k plans use mutual funds. Portfolio: A collection of investment assets. A well-diversified portfolio might include assets such as stocks, bonds, exchange-traded funds and mutual funds. Retirement age: The age you retire depends on you. Full Social Security benefits currently begin at age 66, but will rise to 67 for people born in and later. Early retirement benefits are available at 62, but at a lower monthly amount.
Returns: The money you earn or lose from an investment. Risk: The possibility that an investment will perform poorly or even cause you to lose money. In general, a low-risk investment will deliver lower potential returns and a high-risk investment may deliver higher returns, but may also cause you to lose your investment.
Robo-advisor: An automated investing service or online advisor. Robo-advisors use computer algorithms and software to create and manage investment portfolios, including IRAs. They're often less expensive than human financial advisors. Tax-advantaged: When you get tax benefits from an investment account. For example, you can make k contributions from your paycheck before tax is taken out. You don't pay taxes on those contributions or the earnings until you withdraw the money.
In other accounts, such as Roth IRA, you can pay taxes on your contributions up front, then withdraw your money tax-free in retirement. New to k s? Learn the basics with our k guide. Tax Savings. Employer Match. What Is a k? A k is a specific type of retirement plan only offered to employees through an employer; you cannot establish a k on your own like you can an individual retirement account IRA. A k allows you to put aside pre-tax dollars — up to a certain limit set by the Internal Revenue Service IRS — into a retirement account whose investments usually mutual funds are determined by your employer and often management by a third-party investment company.
Unlike an IRA, you have fewer investment choices with a k because your employer manages what specific investments are offered to you. Because a k allows your investment income to accumulate tax-deferred and affords you specific tax benefits with the IRS, it is classified as a qualified retirement plan.
With a k , your employer also may offer you matching contributions — maxing out at a certain percentage of your annual k contribution — as a part of your benefits package.
Once you retire from your employer, you become fully responsible for the funds from your k account. And if you transfer to another job, you may choose to roll over your k into an IRA or to your new employer. Learn more about the differences between a k retirement plan and an IRA.
How Much Can You Contribute to a k? Each tax year the IRS establishes its k contribution limits. Two annual limits apply to these contributions: 1 a limit on your employee elective salary deferrals contributions you make to your k plan in lieu of receiving this money as salary and 2 an overall limit on contributions to your k , including employer matching contributions.
How Does a k Grow? The growth of your k largely depends on the amount of money you contribute to your account each year as an employee and the matching contributions that your employer adds to your account over time. The more money you and your employer contribute to your k , the more potential it has to grow. The other important factor influencing how quickly you accumulate money in your k retirement account is the growth of your investments, which depends on your annual rate of return.
Because your employer or a third-party investment firm hired by your employer manages the investments in your k , you have less choice and control over how the funds in your k account are invested compared to an IRA.
To review long-term market returns for small-company stocks, large-company stocks, government bonds and U. Understanding these historic compound annual return rates may help you gauge expectations for your k. Through the power of compounding interest the retirement savings you and your employer deposit into your k account may grow into a sizeable sum.
Keep in mind that investments in a k are subject to market risk, including the potential to lose the entire principal amount invested. You have 37 years until you retire. You get paid biweekly. Using This Simple k Calculator Our k Growth Calculator is a simple and easy way to estimate the long-term growth of your k retirement account by the time you want to retire.
About Your Inputs Our k Growth Calculator asks you to complete various fields of information about the assumptions you want to make, your k plan specifics and current annual contribution to estimate the future value of your account before retirement.
0コメント