Latest news with #401k
Yahoo
5 hours ago
- Business
- Yahoo
I'm 45 with 5 children to support and my husband just died unexpectedly — how do I ensure we're taken care of?
The death of a spouse is devastating under any circumstances. But, what happens if your spouse who passed away was also the breadwinner for your family of seven, including five children? When this type of tragic incident occurs, survivors left behind can find their whole life changed. Now, imagine that you are the surviving spouse. You have a disability, with a $1,500 monthly benefit and you own a home that you owe $220,000 on. And, your basic monthly bills (not including expenses like food, transportation and health care) are $3,320. Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 5 of the easiest ways you can catch up (and fast) Nervous about the stock market in 2025? Find out how you can access this $1B private real estate fund (with as little as $10) You'd probably be panicking about your financial future in this situation, and rightly so. The big question is, what can you do to ensure that you and your children are provided for and the bills get paid? The first thing to do in this situation is to determine what your finances look like based on what your spouse left behind. Look to see if your husband has a will, and take account of any assets you may have, such as your spouse's workplace 401(k), life insurance policies, bank accounts and investment accounts. Hopefully, you and your spouse communicated about these issues, and you know where to look. If not, you may have to contact financial institutions, look at your spouse's computer history and email to see if you can find statements and use the National Association of Insurance Commissioners (NAIC) life insurance policy locator. In most cases, the estate will need to go through probate to officially transfer certain property and assets. A legal aid attorney may be able to help you through this process if you can't afford a lawyer otherwise. If you were a joint owner on any assets, though, you should be able to access those right away. With luck, your spouse left something behind that can help you to make ends meet in this difficult situation. Depending on the equity in your home, you may also be able to downsize to something less expensive while freeing up cash you can invest to produce income to live on. Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says — and that 'anyone' can do it If your spouse left behind limited resources, the next step is to try to claim any benefits that may be available to you. This can include survivor benefits from Social Security. These benefits are available to surviving spouses who are raising minor children, as well as to kids under the age of 17 or kids under the age of 19 if they are still in school. If any of the children have a disability, these benefits can be available at any age. With your limited financial resources, you will likely be eligible for other government benefits as well. These can include: Temporary Assistance for Needy Families (TANF) benefits. Supplemental Nutrition Assistance Program (SNAP) benefits. Medicaid health insurance coverage. Other benefits, such as utility assistance programs and reduced property taxes, may also be on offer. Check and search your state's assistance programs to see what is available. These benefits can help you to make ends meet. After the death of a breadwinning spouse, it normally would make sense for you to go back to work. However, that may not be the case if you have a disability, because earning too much money could affect your eligibility for disability and other benefits. Of course, if you could earn enough to support yourself and your family despite your disability, doing so would be a good idea. If your condition prevents you from doing that, though, then you could end up worse off if you earn too much to get benefits but not enough to meet your needs. Still, you can check with the benefits programs you participate in to see how much you are allowed to earn before losing benefits, and check out programs that help with job training and searches for people with a disability. Finally, you need to think about creating more stability for yourself in your future — including emotional and financial stability. Taking steps to become more financially stable, like trying to build an emergency fund and savings, can be a good first step. You should also make sure to get the emotional support you need after a devastating loss. Check with your local community center, health center, faith group or hospital for support groups that may be available for you and your kids. Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now This is how American car dealers use the '4-square method' to make big profits off you — and how you can ensure you pay a fair price for all your vehicle costs Like what you read? Join 200,000+ readers and get the best of Moneywise straight to your inbox every week. This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
Yahoo
7 hours ago
- Business
- Yahoo
Delaying Your 401(k) Rollover Could Cost You $76K, Study Finds
Even though much of the financial world is now digitized, rolling over your 401(k) still often involves a more complicated process that can't be done online. Many plans require you to transfer funds via mail, which can lead to delays in getting your funds invested into your new account. Find Out: Read Next: While you might not think too much about the consequences of this lag time, it can lead to thousands of dollars in lost retirement savings, according to a new study conducted by PensionBee. Here's a look at how much you stand to lose due to delays in a 401(k) rollover. Putting off rolling over your funds and mail delays that are out of your control can have serious financial consequences, especially when you take a long-term view. According to the PensionBee study, even brief two- to eight-week market absences during rollovers can cost savers tens of thousands of dollars, particularly during periods of market volatility. The study found that for savers with a $100,000 401(k) balance, an eight-week processing delay could mean $76,000 in lost returns over 30 years. A $50,000 balance could experience a $38,442 loss due to an eight-week processing delay, and a $10,000 balance could experience a $7,688 loss. Even shorter-term delays can lead to significant losses — a two-week rollover delay could compound to a $37,512 loss over 30 years if you're starting with a $100,000 balance. Be Aware: As these figures show, delaying your 401(k) rollover can have significant financial consequences. But the risks of delaying a rollover go beyond lost returns. 'Everyone thinks they'd never forget a retirement account, but there are 30 million unclaimed accounts that tell us otherwise,' said Romi Savova, founder and CEO of PensionBee. 'For job-changers, each position can become another account left behind. The average person switches jobs 12 times, so the sheer volume of personal admin can be very difficult to manage.' Forgetting to roll over old accounts can make you subject to fees that can eat away at your savings. 'People are often unaware that there are fees associated with retirement accounts,' Savova said. 'While your employer may cover some or all of your fee burden while you're employed, that responsibility can shift entirely onto former employees, often with minimal notice.' If you have a 401(k) account with a balance of $7,000 or less, these fees can eliminate your entire savings. 'Employers can automatically force out small balances into poorly performing Safe Harbor IRAs, which can deplete balances entirely,' Savova said. 'These bad defaults are marked by high fees and low returns, often below 2%. If you don't act fast and have an account under $1,000, your employer may cash it out automatically, leaving you to foot the associated fees and tax penalties.' Rolling over a 401(k) can be a complicated task, but it's important to tackle it sooner rather than later. 'While the system needs to change, consumers can immediately take several steps to minimize downsides,' Savova said. 'First, take an active role in the process. Rolling over a 401(k) is a multistep process, and delays at any point can be costly. When it comes to retirement, time in the market is more important than timing the market — even a few weeks or months out can mean thousands lost over a lifetime.' If you're rolling a 401(k) balance from a former employer into a new 401(k), you may not have a lot of choices, but if you choose to roll into an IRA, make sure you are choosing your provider wisely. If possible, find a provider that offers digital-first solutions with automated tracking. 'The best providers will offer digital rollover solutions, avoiding checks in the mail, and excellent customer support when speaking with your old provider is inevitable,' Savova said. 'Customer-focused providers handle the paperwork burden, proactively follow up with your previous plan administrator and keep you updated throughout the process.' Also, pay attention to more than just fees when choosing a provider. 'While high fees over 1% should generally be avoided, also consider the customer support model and technological capabilities,' Savova said. 'The right provider becomes a partner in your retirement journey, not just a place to store your money.' More From GOBankingRates I'm a Retired Boomer: 6 Bills I Canceled This Year That Were a Waste of Money This article originally appeared on Delaying Your 401(k) Rollover Could Cost You $76K, Study Finds Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
a day ago
- Business
- Yahoo
This Is the Best Way To Contribute To Your 401(k)
Contributing to a 401(k) or other workplace retirement plan is a great way to save money so that you can retire comfortably when you're ready. One of the big advantages to saving this way is that you can 'set it and forget it.' Read More: Explore Next: But that doesn't mean you don't need to put some thought into how you contribute. Here's what you need to know about the best way to contribute to your 401(k). Your 401(k) contributions should start as soon as possible. Even if you can't contribute very much, contribute something. The money is deducted from your gross pay before you get your paycheck, so you'll never miss it. When you start a new job, start your 401(k) contributions immediately if you can. Some companies will enroll you automatically, so check to see if yours is an opt-out plan (meaning you have to tell your employer if you don't want to participate). If you are automatically enrolled, make sure the amount is what you want it to be. See Now: Many companies will match your contributions, up to a certain percentage of your salary. Some companies will match half of what you contribute, or 50 cents on the dollar, while others will match dollar-for-dollar. They may match up to 3% or 5% of your salary. If you can, contribute at least as much as you need to in order to get the maximum match. The company match is essentially free money that your employer is giving you toward your retirement savings, but you have to contribute in order to get it. Here's an example. Suppose your annual salary is $100,000. Your employer offers a 401(k) plan with a matching employer contribution of 50 cents per dollar, up to 5% of your salary. This means that your employer will contribute half of what you contribute, but no more than $5,000 per year. If you contribute $5,000 per year (5% of your salary), your company will match that with $2,500 per year (half of your contribution). If you contribute $10,000 per year, your company will match that with $5,000. If you contribute $15,000 per year, your company will match that with $5,000, since that's 5% of your salary, which is the maximum they will match. Some companies will match 100% of your contributions, and the maximum percentage of your compensation that the company will match can vary. Check with your human resources department to see what your company offers. The amount you contribute to your 401(k) is always available to you to rollover or withdraw (although a tax penalty may apply), but the company may impose a vesting schedule. Many companies will vest 20% of their contributions per year, so after 5 years, the company's contributions are 100% yours. But if you leave the company before that time, you will only get part of the company match money. As important as it is to start early when you contribute to your 401(k), it's equally important to increase your contributions as you get older. This will help your 401(k) balance to keep pace with increases in the cost of living and will help you stay on track for a comfortable retirement. When you get a raise, use part of the increase to boost your 401(k) contributions. For example, if you get a 4% increase in your pay, increase your 401(k) contribution by 2%, and get the other 2% in your check. Keep doing this until you are contributing the maximum possible amount, which is $23,500 in 2025 if you're under 50. If you're over 50, you can contribute an additional $7,500 for a total of $31,000. Those who are between 60 and 63 can contribute a total of $34,750. While it's best to set your contribution amount and then forget about it (until you're able to increase it, of course) but you don't want to do that with your investments. Your asset allocation should change as you age. You can be aggressive in your 20s and 30s, but your investments should become more balanced in your 40s and 50s, and move to the conservative end of the investment spectrum in your 60s. The reason you want to adjust your retirement portfolio as you age is obvious: you have more time to recover from a downturn when you're younger. Investments that can fluctuate 20 or 30% in either direction are fine when you're younger, because if you do experience a steep drop, you can wait for the market to rebound. A 25% drop in your 60s, however, could be devastating. An easy way to manage your investments is with a target date fund. A target date fund is a mutual fund that includes positions that are tied to a specific date in the future. If you plan to retire in 2070, for example, you can choose a 2070 target date fund. This fund would have a fairly aggressive mix of investments, such as individual stocks or tech mutual funds, right now. Over time, the investments would shift toward more bonds and other conservative investments. Note that you don't have to choose a target date fund that corresponds exactly with your expected retirement date. If you plan to retire in 2070 but you're comfortable taking a little more risk, you can choose a 2075 target date fund. Or, if you're more conservative, you can choose a 2065 target-date fund. The single best way to contribute to your 401(k) is to simply do it. Start today and take advantage of the magic of compounding. Increase your contributions as you can, keep an eye on your investments and before you know it, you'll be heading for retirement with a nice financial cushion. More From GOBankingRates 9 Downsizing Tips for the Middle Class To Save on Monthly Expenses Are You Rich or Middle Class? 8 Ways To Tell That Go Beyond Your Paycheck This article originally appeared on This Is the Best Way To Contribute To Your 401(k)
Yahoo
a day ago
- Business
- Yahoo
I'm 29 with plenty of cash, a robust 401(k) and own a condo — but I feel left behind and lonely. What now?
Picture this: You own a home, along with $130,000 in cash savings and $40,000 in your 401(k), and you're not even 30 years old yet. On paper, this is a great financial situation. But after years of pinching pennies, turning down dinner invites and putting fun on layaway, was the sacrifice worth it? Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 5 of the easiest ways you can catch up (and fast) Nervous about the stock market in 2025? Find out how you can access this $1B private real estate fund (with as little as $10) Welcome to the emotional hangover of hyper-saving, a side effect of the FIRE (Financial Independence, Retire Early) movement. If this sounds like you, we've got some strategies for how to be fiscally responsible and still enjoy your life. The FIRE movement is a financial movement that is made up of intense saving and budgeting to support an early retirement. Saving 50% to 70% of your income sounds glamorous on paper, and for the ultra-disciplined, it's a path to fast-track financial goals. But when social life takes a back seat to spreadsheet life, the returns may not always be what they seem. According to the Federal Reserve data, as of 2022, the median net worth for American households under 35 years old is just $39,000. So, if you're in your late twenties with six figures saved and real estate in your name, you've already lapped this figure several times over. But while your bank account may be full, what can you do if your social calendar is blank? Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says — and that 'anyone' can do it Once you've nailed the basics, like establishing an emergency fund, bolstering your retirement savings and acquiring some equity, it could be time to rebalance. Financial stability should be your launch pad to life, not the finish line. Here are some ways to reclaim your social life: The 'Yes Month': Say yes (within reason) to social invites for a month. Go to that concert. Grab rooftop drinks. RSVP 'yes' to life. Giving yourself permission to live a little can revitalize your emotional well-being. Create a 'Fun Fund': Set aside a guilt-free allowance for everything you used to say 'no' to, such as weekend getaways, dinners out, shopping or even grabbing a coffee. Book a short trip: Whether it's a road trip or something more exotic, a short, reasonably priced escapade can reset your perspective and your priorities and give you time for self-reflection. Talk to a professional: A financial advisor can help you pivot from survival-mode saving to intentional living. Think of it this way, you take your car in for service regularly, right? So consider these meetings to be a tune-up for your money mindset. You may also want to ask yourself: 'What does 'enough' look like — for me?' This can be used as a baseline for your saving mindset. Defining what's 'enough' — whether it's a certain amount of savings or a paid-off mortgage — can help you figure out how much room you have to enjoy other things while you work toward achieving that goal. Saving aggressively in your 20s is a powerful move. But financial independence isn't just about escaping work; it's about designing a life you actually want to live. If you're sitting on a growing bank account and a shrinking social life, maybe it's time to rebalance the books, not just financially, but emotionally. Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now This is how American car dealers use the '4-square method' to make big profits off you — and how you can ensure you pay a fair price for all your vehicle costs Like what you read? Join 200,000+ readers and get the best of Moneywise straight to your inbox every week. This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
Yahoo
a day ago
- Business
- Yahoo
Trump's trade war is bruising Apple — and your 401(k)
President Donald Trump's swipes at Apple aren't just bruising the company's bottom line — they may also be taking a bite out of your 401(k). The president's chaotic trade war continues to threaten Apple's business model, which relies extensively on international supply chains. Apple's stock has tumbled 20% this year after hitting a record high in December. The company's stock dropped 3% in one day earlier this month after Trump demanded Apple move all of its production to the United States. As the tech giant grapples with the president's tariff threats, Americans' retirement savings have taken a hit, too. Apple, the third-largest US company by market value, is a core component of many retirement plans, such as 401(k)s. Retirement savings are often invested in funds that track the S&P 500, and (AAPL) accounts for 6% of the S&P 500's value, according to Howard Silverblatt, senior index analyst at S&P Dow Jones Indices. The S&P 500 is weighted by market value. That means the larger a company is, the more it influences the index. The tech giant has shed nearly $1 trillion in market value this year. Its market value topped a record high $3.9 trillion in December, according to FactSet, but was down to just above $3 trillion as of Friday. The company's stock also sank 9.25% and posted its worst day in five years after Trump's initial announcement of massive 'reciprocal' tariffs in early April. Apple isn't the only stock souring. Shares of other large companies like Amazon (AMZN), Google (GOOGL) and Tesla (TSLA) have tumbled 6%, 9% and 14% this year respectively, which could also cause the values of 401(k)s to stall. The two largest companies in the United States by market value, Microsoft (MSFT) and Nvidia (NVDA), have gained 9% and 0.6% respectively this year. The S&P 500 is up just 0.5% as other stocks have lagged. 'You just can't continue to keep an economy and companies operating in a cloud of extraordinarily high uncertainty forever without some economic consequences eventually,' said Scott Ladner, chief investment officer at Horizon Investments. Americans collectively held $44.1 trillion in retirement assets at the end of 2024, according to data from the Investment Company Institute. Of those funds, about $8.9 trillion were held in 401(k)s. Retirement savings are long-term investments, and short-term volatility is often overcome by long-term gains. As evidenced by the S&P 500's rally in recent weeks, it's ill-advised to try and sell your portfolio in times of panic because you can miss out on rebounds in the market. Historically, short-term downturns are overcome by gains. Market downturns can be unnerving, but the stock market generally rewards investors who are patient. Trump's trade war has dealt a blow to some of America's most widely held stocks, and investors — whether Wall Street titans or regular folks with a 401(k) — have been left to stomach the volatility. Blue-chip stocks have fluctuated, and the reliable strategy of buying and holding has been put through the wringer as stocks have bounced around without much clarity. It's important to know what your retirement savings are invested in to ensure your portfolio is well diversified, said Tim Steffen, director of advanced planning at Baird Private Wealth Management. While funds that track indexes like the S&P 500 are relatively well diversified, different 401(k) plans can offer funds with different exposures to areas of the market. It's helpful to know how much you have invested in big names like Apple to better gauge how policies affect your portfolio during periods of volatility. 'You may think you've got a very diversified account because you have four different mutual funds, but if all four of those funds are tracking the same type of stocks, you probably don't have a very diversified portfolio,' Steffen said. Market downturns are opportunities to check your exposure and consider diversifying. Investing in mutual funds or exchange-traded funds that track bonds or international stocks can help mitigate risk and offset sharp declines. 'That's really the point behind mutual funds or ETFs,' Steffen said. 'It's an efficient way to get a diversified portfolio.' Thomas Martin, senior portfolio manager at Globalt Investments, said Apple has certainly been 'having a tough year,' but he doesn't think the company is in 'any danger of being a long-term underperformer.' 'I don't think people should be looking at the value of their 401(k) on a daily basis,' Martin said, noting that it is long-term money that will grow over years and decades. Apple faces two major 'unknowns' this year, according to Angelo Zino, a senior vice president and technology analyst at CFRA Research. 'First and foremost, it's the tariff talk,' Zino said. The tech giant is at the top of the list of companies exposed to uncertainties around tariffs, he said. 'We need to wait to see what that outcome is going to look like, and that's creating uncertainty in the share price right now.' Then there are the ongoing antitrust concerns against fellow tech giant Alphabet (GOOGL), Google's parent company. A federal judge in August ruled Google had an illegal monopoly on search, which could signal trouble ahead for Apple because the case centered in part on exclusive deals between Google and Apple, according to Zino. Despite the fluctuations, Apple is still seen as a strong and resilient investment, said Zino and Sam Stovall, chief investment strategist at CFRA Research. The strategists at CFRA, who have a 'buy' on the stock, said its 'premium valuation' is justified by factors including strong capital returns and its stable free cash flow. 'The Street has continuously tried to kill off Apple at times,' Zino added. 'There's always been something out there, and Apple has always been able to find a way to evolve.'
