Real Simple’s New Rules of Retirement Summit: Your Most Pressing Questions, Answered
Get ready for a new perspective on your retirement planning.
2020 wasn't easy: Based on the Fidelity Investments 2021 State of Retirement Planning Study, 82 percent of Americans say the events of the past year have impacted their retirement plans. Still, it's possible to build the retirement of your dreams—and an effective retirement planning strategy, for those who are a few years (or decades) from retirement. Whether you're four years or 40 years from your preferred retirement age, Real Simple's New Rules of Retirement virtual event offers easy, inspiring, and innovative ways to take charge of your future.
With tips from experts, including self-described financial hype woman Berna Anat and Melissa Ridolfi, senior vice president of retirement and cash management at Fidelity Investments, the hour-long event helps demystify some of the retirement planning process. Tune in after Friday, March 26, at 5 p.m. ET to watch a recording of the full event, and download the helpful handout below with our top tips for retirement planning. Then read on for answers to some of the most commonly asked questions from the event.
Q: I have this much money in a 401(k), I own a home, and I earn this much money—when can I plan to retire?
Unfortunately, specific questions like these require specific answers, and an expert—such as a certified financial planner—is the best person to ask for particulars. For a detailed, personalized answer that fits your specific financial situation, we recommend you speak with a financial advisor, who can help you figure out the best course of action for your retirement plan.
Q: Do you have tips for finding, working with, or knowing the costs of a financial planner or advisor?
You can learn more about finding the right financial planner for you here. Some advisors may charge a flat fee, while others may work on commission. It's important to speak openly with planners you're considering to make sure you're comfortable working with them—and paying the associated fees. At the end of the day, if you have questions about your specific financial situation, a financial planner is the best person to help you put together a personalized plan—and that kind of support is often well worth the cost.
Q: How do withdrawals from IRAs and 401(k)s work?
Generally, penalty-free 401(k) distributions don't start until the account holder is 59 1/2 years of age, and required distributions begin at age 72. Traditional IRAs and 401(k)s both have required minimum contributions starting at age 72; Roth IRAs have no required withdrawals.
Q: Do you have any advice about long-term care insurance?
Long-term care insurance can help make the high costs associated with later-in-life care manageable, particularly if you purchase your policy early. Learn more about long-term care insurance here.
Q: What is the difference between a 401(k) and an IRA? Can I have both?
A 401(k) is an employer-provided plan, while an IRA (or individual retirement account) can be set up at any financial institution. You can have a 401(k) and a Roth IRA, for example, at the same time to take advantage of pre- and post-tax savings opportunities. Learn more about different retirement accounts here.
Q: I'm just beginning my retirement planning journey—where do I start?
Q: How do I access the Fidelity Retirement Score?
You can use Fidelity's Retirement Calculator to find your preparedness score for retirement here.
Q: I'm saving for my retirement and my child(ren)'s education(s) at the same time. What's my best course of action?
A 529 plan is a tax-advantaged way to save for education expenses. You can start one for a member of your family, and if they choose not to attend college or don't use the full amount, you can roll leftover funds into an account for another eligible family member (such as a grandchild) penalty-free. Most experts recommend prioritizing your retirement savings over paying for college for your children—you can take out a loan to pay for college, after all, but you can't take out a loan to help pay for retirement.