FINANCIAL FOCUS – When Do You Need a Financial Advisor?

If you could accomplish all your financial goals just by putting your paycheck

into the bank every couple of weeks, you wouldn’t need the services of a financial advisor. But life isn’t that simple – and so, at some point, you may realize you need some professional assistance. But when?

Actually, you might benefit from the services of a financial advisor during many life events, including the following:

  • Starting your career – When you’re starting out in your career, you may encounter several questions related to your benefits package. Should you contribute to your 401(k) or other employer-sponsored plan? If so, how much, and where should you invest your money? Are the life and disability insurance policies offered by your employer sufficient for your needs? A financial advisor can help you answer these and other questions you may have.
  • Getting married – When you get married, you’ll have to decide if, and how, you want to combine your finances. Also, you and your spouse may have different attitudes about investing and different tolerances for risk. A financial professional can help you find common ground.
  • Changing jobs – When you switch jobs, what should you do with your old employer’s retirement plan? And how should you invest in the plan offered by your new employer? As was the case when you first began your career, you may find that a financial professional can help you make the right choices.
  • Facing a layoff or buyout – You may never go through a layoff, or take a buyout offer from an employer – but if either of these events happen, you will face some financial decisions. And during such a potentially stressful period, you may be tempted to make some financial moves that won’t be beneficial. A financial advisor can suggest some strategies that may help you keep your investment situation relatively intact until you land your next job.
  • Saving for college – If you have children whom you’d like to send to college someday, you’ll probably want to start putting money away as early as possible. A financial professional can show you the various college-savings vehicles, and help you choose the ones that are most appropriate for your needs.
  • Getting divorced – If you are fortunate, you won’t ever experience a divorce, but, if it does happen, you’ll want to get the professional assistance necessary to ensure fair outcomes for everyone. You’ll obviously need to work with an attorney, but you may find that, in the area of investments, a financial advisor also can be useful.
  • Entering retirement – As you near retirement, your key questions will switch – but not entirely – from putting money in to taking money out. How much can you withdraw each year from your 401(k) and IRA without running the risk of outliving your resources? When should you start taking Social Security? If you were to work a couple of years longer than you had originally intended, how would it affect your withdrawal strategies? Again, a financial advisor can help you with these issues.

As you can see, most important life events will carry some financial concerns. But you don’t have to face these challenges alone – and by getting the help you need, when you need it, you can ease the transition from one stage of life to another.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

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FINANCIAL FOCUS – How Can You Improve Your Financial Fitness This Year?

If one of your New Year’s resolutions is to get healthier, you may already be taking the necessary steps, such as improving your diet and increasing your exercise. Of course, physical fitness is important to your well-being – but, at the same time, don’t forget about your financial fitness. Specifically, what can you do to ensure your investment situation is in good shape?

Here are a few “healthy living” suggestions that may also apply to your investment portfolio:

  • Build endurance – Just as exercise can help build your endurance for the demands of a long life, a vigorous investment strategy can help you work toward your long-term goals, such as a comfortable retirement. In practical terms, this means you will need to own some investments with the potential to provide long-term growth. These are the investments that, ideally, you can hold on to for decades and eventually reap the benefits of capital appreciation. Of course, growth-oriented investments, such as most types of stocks, will rise and fall in value over the short term, and there’s no guarantee of profits, or even preserving principal. But if you choose wisely, and you’ve got the patience and discipline to hold on to your investments through the market’s ups and downs, you may well be rewarded.
  • Maintain an ideal “weight” – You can help yourself stay healthy by maintaining your ideal weight. This can be challenging – as you know from the recently finished holiday season, it’s easy to put on a few extra pounds. And, just as inadvertently, your portfolio can tack on some unneeded weight, too, in the form of redundant investments. Over time, you may have picked up too many similar investment vehicles, resulting in an overconcentration, or “flabbiness,” that can work against you, especially when a market downturn affects the asset class in which you’re overloaded. So, you might be better off liquidating some of your duplicate, or near-duplicate, investments, and using the proceeds to help broaden your investment mix.
  • Get proper rest – Many studies have shown that we need adequate rest to stay alert and healthy. In your life, you’ve probably already found that if you over-tax your body, you pay a price in your overall well-being. If you look at your investment portfolio as a living entity – which, in a way, it is, as it certainly provides life to your goals and aspirations – then you can see that it, too, can be weakened by stress. And one of the main stress factors is excessive trading. If you’re constantly buying and selling investments in an attempt to boost your returns, you may rack up hefty fees, commissions and taxes – and still not really get the results you wanted. Plus, if you’re frequently moving in and out of different investments, you’ll find it hard to follow a unified, long-term strategy. So, confine your trading to those moves that are really essential – and give your portfolio a rest.

To enjoy your life fully, you’ll want to take care of your physical and financial health – and, as it turns out, you can make similar types of moves to help yourself in both areas.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

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FINANCIAL FOCUS – Time is a Key Factor in Investing

With the arrival of the New Year, many of us will pause and ponder the age-old question: “Who knows where the time goes?” And, as is always the case, none of us really do know. However, wherever the time goes, it will usually be a key factor in your success as an investor.

Time can affect how you invest, and the results of your investing, in different ways:

  • Growth potential – Contrary to myth, there’s no real way to “get rich quick” when investing. To build wealth, you need patience – and time. If you own quality investments with growth potential, and you give them years – in fact, decades – to increase in value, your perseverance may be rewarded. Of course, there are no guarantees, and you’ll need the discipline to withstand the inevitable downturns along the way. But in describing how long he likes to keep his investments, renowned investor Warren Buffet says his favorite holding period is “forever.”
  • Targeted goals – To accumulate resources for retirement, you need to save and invest throughout your working life. But along the way, you’ll probably also have some shorter-term goals – making a down payment on a home, sending your children to college, taking a round-the-world trip, and so on. Each of these goals has a specific time limit and usually requires a specific amount of money, so you will need to choose the appropriate investments.
  • Risk tolerance – The element of time also will affect your tolerance for risk. When you have many decades to go until you retire, you can afford to take more risk with your investments because you have time to overcome periods of market volatility. But when you’re on the verge of retirement, you may want to lower the risk level in your portfolio. For example, you may want to begin moving away from some of your more aggressive, growth-oriented investments and move toward more income-producing vehicles that offer greater stability of principal. Keep in mind, though, that even during retirement, you’ll need your portfolio to provide enough growth opportunity at least to help keep you ahead of inflation.

Thus far, we have looked at ways in which time plays a role in how you invest. But there’s also an aspect of time that you may want to keep out of your investment strategies. Specifically, you might not want to try to “time” the market. The biggest problem with market timing is it’s just too hard. You essentially have to be right twice, selling at a market top and buying at the bottom. Also, as humans, we appear to be somewhat wired to think that an activity – especially a long-running activity – will simply continue. So, when the market goes up, we seem to expect it to keep rising, and when the market drops, we think it will continue dropping. This can lead to big mistakes, such as selling after a major market drop even though that can be the time when it may be much smarter to buy because prices are low.

As we’ve seen, the way you interact with time can affect your investment efforts. So, think carefully about how you can put all the days, months and years on your side. Time is the one asset you can’t replenish – so use it wisely.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

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FINANCIAL FOCUS – Are You a Snowbird? Protect Your Finances While You’re Gone

Winter is (just about) officially here – but you may soon be leaving it behind if you’re a snowbird. When you go, though, you’ll want to keep your financial situation from getting caught out in the cold.

These are a few suggestions you may want to consider:

  • Protect your home. If you’re like many people, your home is your biggest investment, so you’ll want to protect it while you’re away. You’re probably already familiar with the steps you should take, such as informing your neighbors that you’ll be gone, stopping your newspapers, forwarding your mail, using a timer to turn lights on and off, and so on. And these days, with smart phones and advanced security systems, you can look in on your home whenever you like.
  • Notify your bank. Recognizing the prevalence of identity theft, the fraud departments of many banks are getting more aggressive in spotting and denying unusual charges. Consequently, you’ll want to give your bank your temporary address and contact information before you leave. By doing so, you can reduce the risk of your account being frozen temporarily if your financial institution can’t reach you with questions about charges from an unexpected location. You might also find it useful to open a bank account at your snowbird site.
  • Gather your tax forms. If you’re gone most of the winter, you may bump up against the tax-filing deadline, which, in 2018, is April 17. So, to allow yourself enough time to prepare your taxes, or to have them prepared by a professional, gather your tax information before you leave. Make sure you’ve got all your investment-related forms, such as your 1099-INT (for interest income) and your 1099-DIV (for taxable capital gains and dividends).
  • Track your investments. You can probably track the progress of your investments online, and it’s a good idea to do so, just as you would at your permanent residence. Even if you’re only gone a couple of months, you may need to make some investment moves, such as “maxing out” on your IRA, so stay on top of your accounts and contact your investment professional, as needed. As always, though, don’t overreact to sudden market swings – ideally, you’ve got long-term strategies in place that can serve your needs in most investment environments. In any case, it also wouldn’t hurt to notify your financial professional that you’ll be away for a while, even if you typically only see him or her a couple of times a year.
  • Arrange for bill payments. If you handle most of your bills online or through auto-pay, you won’t have to worry about missing a payment while you’re gone. Still, if you take care of some bills the old-fashioned way, with checks, envelopes and stamps, you may want to give yourself some sort of reminder of when these payments are due.
  • Be careful on social media. To be on the safe side, you may not want to trumpet your extended time away from home on Facebook or other social media platforms. It’s sad but true that identity thieves watch for information like this.

In all likelihood, you’ll enjoy being a snowbird – and by making the above moves, you’ll have less financial baggage to deal with when you take off.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

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FINANCIAL FOCUS – Time to Review Your Investment Strategy for the Year

As the year draws to a close, it’s a good time to review your progress toward your financial goals. But on what areas should you focus your attention?

Of course, you may immediately think about whether your investments have done well. When evaluating the performance of their investments for a given year, many people mistakenly think their portfolios should have done just as well as a common market index, such as the Standard & Poor’s 500. But the S&P 500 is essentially a measure of large-company, domestic stocks, and your portfolio probably doesn’t look like that – nor should it, because it’s important to own an investment mix that aligns with your goals, risk tolerance and return objectives. It’s this return objective that you should evaluate over time – not the return of an arbitrary benchmark that isn’t personalized to your goals and risk tolerance.

Your return objective will likely evolve. If you are starting out in your career, you may need your portfolio to be oriented primarily toward growth, which means it may need to be more heavily weighted toward stocks. But if you are retiring in a few years, you may need a more balanced allocation between stocks and bonds, which can address your needs for growth and income.

So, assuming you have created a long-term investment strategy that has a target rate of return for each year, you can review your progress accordingly. If you matched or exceeded that rate this past year, you’re staying on track, but if your return fell short of your desired target, you may need to make some changes. Before doing so, though, you need to understand just why your return was lower than anticipated.

For example, if you owned some stocks that underperformed due to unusual circumstances – and even events such as Hurricanes Harvey and Irma can affect the stock prices of some companies – you may not need to be overly concerned, especially if the fundamentals of the stocks are still sound. On the other hand, if you own some investments that have underperformed for several years, you may need to consider selling them and using the proceeds to explore new investment opportunities.

Investment performance isn’t the only thing you should consider when looking at your financial picture over this past year. What changed in your life? Did you welcome a new child to your family? If so, you may need to respond by increasing your life insurance coverage or opening a college savings account. Did you or your spouse change jobs? You may now have access to a new employer-sponsored retirement account, such as a 401(k), so you’ll need to decide how much money to put into the various investments within this plan. And one change certainly happened this past year: You moved one year closer to retirement. By itself, this may cause you to re-evaluate how much risk you’re willing to tolerate in your investment portfolio, especially if you are within a few years of your planned retirement.

Whether it is the performance of your portfolio or changes in your life, you will find that you always have some reasons to look back at your investment and financial strategies for one year – and to look ahead at moves you can make for the next.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

marques-young

FINANCIAL FOCUS – Can You Afford to Retire Early?

Some people dream of retiring early. Are you one of them? If so, you’ll need to plan ahead – because a successful early retirement can’t be achieved through last-minute moves.

So, if you’re determined to retire early, consider taking the following steps:

  • Pick a date. Early retirement means different things to different people. But it’s important to pick an exact age, whether it is 60, 62, 64, or whatever, so you can build an appropriate retirement income strategy.
  • Think about your retirement lifestyle. You may know that you want to retire early – but have you thought about what you want to do with your newfound time? Will you simply stay close to home and pursue your hobbies? Do you dream of spending two months each winter on a tropical island? Or are you thinking of opening your own small business or doing some consulting? Different retirement lifestyles can have vastly different price tags. Once you’ve envisioned your future, you can develop a saving and investment plan to help you get there.
  • Boost contributions to your retirement plans. If you want to retire early, you may well need to accelerate your contributions to your retirement accounts, such as your IRA and your 401(k) or other employer-sponsored plan. You may need to cut back in other areas of your life to maximize the amounts you put into your retirement plans, but this sacrifice may be worth it to you.
  • Invest for growth. Your investment strategy essentially should be based on three key factors: your goals, risk tolerance and time horizon. When you change any one of these variables, it will affect the others. So, if you shorten your time horizon by retiring early, you may well need to reconsider your risk tolerance. Specifically, you may need to accept a somewhat higher level of investment risk so you can invest for greater growth potential.
  • Keep a lid on your debt load.  It’s easier said than done, but try to manage your debt load as tightly as possible. The lower your monthly debt payments, the more you can contribute to your retirement plans.

Life is unpredictable. Even if you take all the steps described above, you may still fall short of your goal of retiring early. While this may be somewhat disappointing, you might find that adding just a few more years of work can be beneficial to building resources for your chosen retirement lifestyle. For one thing, you can continue contributing to your IRA and your 401(k) or similar employer-sponsored plan.

Plus, if you’re still working, you may be able to afford delaying your Social Security payments until you’re closer to your “normal” retirement age, which, as defined by the Social Security Administration, likely will be 66 or 67. The longer you put off taking these benefits, the bigger your monthly checks, although they will max out once you reach 70.

And even if you are not able to retire early, some of the moves you took to reach that goal – such as contributing as much as you could afford to your IRA and 401(k), controlling your debts, and so on – may pay off for you during your retirement – whenever it begins.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

marques-young

FINANCIAL FOCUS – Take Action on ‘Giving Tuesday’… and Beyond

You probably already know about the two big shopping days – Black Friday and Cyber Monday – that follow Thanksgiving. But did you know that Giving Tuesday is observed on Nov. 28? By showing your generosity on this day and throughout the holiday season, you can benefit charitable organizations and your loved ones – and your gifts can even provide you with some potential financial advantages.

So, what sort of gifts should you consider? Here are a couple of suggestions for the charitable organizations you support:

  • Give cash. Any charitable group will welcome cash contributions. And if the charity has 501(c)(3) status (named after the section of the Internal Revenue Code that governs such groups), your gift can offer you a tax deduction. So, for example, if you are in the 25 percent tax bracket and you give $1,000 to a qualified charity, you will be able to deduct $250 from your taxes. (You will need to itemize deductions to gain this tax benefit.) Generally speaking, your maximum deduction is limited to 50 percent of your adjusted gross income.

You might be able expand the reach of your cash gifts through your workplace. Some companies will match some of your contributions to charitable organizations. Also, your employer may allow you to apply for larger grants to support nonprofit groups, especially those in which many employees are actively involved.

  • Donate appreciated stocks. If you have stocks that have grown significantly in value, you may want to donate them to a charitable group. You will be allowed a charitable deduction for the full fair market value of the gift on the date of the transfer, even if your original cost was only a fraction of today’s value. Furthermore, you will avoid the capital gains taxes you’d have to pay if you sold the stock, provided you’ve held the stock for at least a year.

You don’t have to restrict your giving to charitable groups. If you have children or grandchildren, you might want to provide them with the gift of higher education by contributing to a 529 college savings plan.

A 529 plan offers several benefits. Contribution limits vary from state to state, but are generally quite high – you can accumulate more than $200,000 per beneficiary in many state plans, although special gifting provisions may apply. And you can typically invest in the 529 plan offered by any state, even if you don’t live there, although you might not receive the tax benefits – such as deductions or tax credits – you’d get if you invested in your own state’s plan.

Also, all withdrawals from 529 plans are free from federal income taxes, and possibly from state income taxes, as long as the money is used for a qualified college or graduate expense of the beneficiary you’ve named – typically, your child or grandchild. (Withdrawals for expenses other than qualified education expenditures may be subject to federal, state and penalty taxes.) Be aware, though, that 529 plans may affect financial aid, particularly if you’ve set up a plan for your grandchild, so you might want to consult with a college’s financial aid office before the child heads off to school.

Through your gifts to charitable groups and your family members, you can take the spirit of Giving Day and extend it throughout the holiday season – and even beyond.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

marques-young

FINANCIAL FOCUS – How Can You Share Your Financial “Abundance” With Your Family?

Thanksgiving is almost here. Ideally, this day should be about more than football and the imminent arrival of Black Friday mega-sales. After all, the spirit of the holiday invites us to be grateful for what we have and for the presence of our loved ones.

But it’s important to look beyond just one day in November if you want your family to take part in your “abundance.” If you want to ensure your financial resources eventually are shared in the way you envision, you will need to follow a detailed action plan, including these steps:

  • Identify your assets. If you haven’t done so already, it’s a good idea to take an inventory of all your financial assets – your retirement accounts (401(k) and IRA), other investments, life insurance, real estate, collectibles and other items. Once you know exactly what you have, you can determine how you would like these assets distributed among your loved ones.
  • Get professional help. To ensure your assets go to the right people, you will need to create some legal documents, such as a will and a living trust. The depth and complexity of these instruments will depend a great deal on your individual circumstances, but in any case, you certainly will need to consult with a legal professional because estate planning is not a “do-it-yourself” endeavor. You may also need to work with a tax professional and your financial advisor, as taxes and investments are key components of the legacy you hope to leave.
  • Protect your financial independence. If your own financial resources were to become endangered, you clearly would have less to share with your loved ones, and if your financial independence were jeopardized, the result might be even worse – your adult children might be forced to use their own resources to help support you. Consequently, you will need to protect yourself, and your financial assets, in several ways. For one thing, you may want to work with your legal professional to create a power of attorney, which would enable someone – possibly a grown child – to make financial decisions for you, should you become incapacitated. Also, you may want to guard yourself against the devastating costs of long-term care, such as an extended nursing home stay. Medicare typically pays very little of these expenses, but a financial advisor may be able to suggest techniques or products that can help.
  • Communicate your wishes. Once you have all your plans in place, you’ll want to communicate them to your loved ones. By doing so, you’ll be sparing your loved ones from unpleasant surprises when it’s time to settle your estate. And, second, by making your plans and wishes known to your family well in advance of when any action needs to be taken, you’ll prepare your loved ones for the roles you wish them to assume, such as taking on power of attorney, serving as executor of your estate, and so on. And you’ll also want to make sure your family is acquainted with the legal, tax and financial professionals you’ve chosen to help you with your estate plans.

Thanksgiving comes just once a year. Taking the steps described here can help ensure your family will share in your financial abundance as you intended.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

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FINANCIAL FOCUS – Stampeding Bull Market May Slow Down … So Be Prepared

As you know, we’ve been enjoying a long period of steadily rising stock prices. Of course, this bull market won’t last forever – and when it does start losing steam, you, as an investor, need to be prepared.

Before we look at how you can ready yourself for a new phase in the investment environment, let’s consider some facts about the current situation:

  • Length – This bull market, which began in 2009, is the second-oldest in the past 100 years – and it’s about twice as long as the average bull market.
  • Strength – Since the start of this long rally, the stock market has produced an average annualized gain of 15.5% per year.

While these figures are impressive, they aren’t necessarily predictive – so how much longer can this bull market continue to “stampede”? No one can say for sure, but there’s no mandatory expiration date for bull markets – in fact, they don’t generally die of old age, but typically expire either because of a recession or the bursting of a bubble, such as the “dot.com” bubble of 2000 or the housing bubble of 2007. And right now, most market experts don’t see either event on the near-term horizon.

Still, this doesn’t mean you should necessarily expect an uninterrupted streak of big gains. Some signs point to greater market volatility and lower returns. To navigate this changing landscape, think about these suggestions:

  • Consider rebalancing your portfolio. If appropriate, you may want to rebalance your investment mix to ensure you have a reasonable percentage of stocks – to help provide the growth you need to achieve your goals – and enough fixed-income vehicles, such as bonds, to help reduce your portfolio’s vulnerability to market volatility and potential short-term downturns.
  • Look beyond U.S. borders. At any given time, U.S. stocks may be doing well, while international stocks are slumping – and vice versa. So, when volatility hits the U.S. markets – as it surely will, at some time – you can help reduce the impact on your portfolio if you also own some international equities. Keep in mind, though, that international investments bring some specific risks, such as currency fluctuations and foreign political and economic events.
  • Develop a strategy. You may want to work with a financial professional to identify a strategy to cope with a more turbulent investment atmosphere. Such a strategy can keep you from overreacting to market downturns and possibly even help you capitalize on short-term pullbacks. You could invest systematically by putting the same amount of money in the same investments each month. When prices go up, your investment dollars will buy fewer shares, and when prices drop, you’ll buy more shares. And the more shares you own, the greater your potential for accumulation. However, this strategy, sometimes known as dollar cost averaging, won’t guarantee a profit or protect against all losses, and you need to be willing to keep investing when share prices are declining.

During a raging bull market, it’s not all that hard for anyone to invest successfully. But it becomes more challenging when the inevitable volatility and market downturns appear. Making the moves described above can help you keep moving toward your goals – even when the “bull” has taken a breather.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

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FINANCIAL FOCUS – Put Lessons From “Retirement Week” to Work

To raise public awareness about the importance of saving for retirement, Congress has designated the third week of October as National Save for Retirement Week. What lessons can you learn from this event?

First of all, save early – and save often. Too many people put off saving for retirement until they are in their late 40s – and even their 50s. If you wait until you are in this age group, you can still do quite a bit to help build the resources you will need for retirement – but it will be more challenging than if you had begun saving and investing while you were in your 20s or early 30s. For one thing, if you delay saving for retirement, you may have to put away large sums of money each year to accumulate enough to support a comfortable retirement lifestyle. Plus, to achieve the growth you need, you might have to invest more aggressively than you’d like, which means taking on more risk. And even then, there are no guarantees of getting the returns you require.

On the other hand, if you start saving and investing when you are still in the early stages of your career, you can make smaller monthly contributions to your retirement accounts. And by putting time on your side, you’ll be able to take advantage of compounding – the ability to earn money on your principal and your earnings.

Here’s another lesson to be taken from National Save for Retirement Week: Maximize your opportunities to invest in the tax-advantaged retirement accounts available to you, such as an IRA and a 401(k) or similar employer-sponsored retirement plan. If you have a 401(k)-type plan at work, contribute as much as you can afford every year, and increase your contributions whenever your salary goes up. At a minimum, put in enough to earn your employer’s matching contribution, if one is offered.

Apart from saving and investing early and contributing to your tax-advantaged retirement accounts, how else can you honor the spirit of National Save for Retirement Week? A key step you can take is to reduce the barriers to building your retirement savings. One such obstacle is debt. The larger your monthly debt payments, the less you will be able to invest each month. It’s not easy, of course, to keep your debt under control, but do the best you can.

One other barrier to accumulating retirement resources is the occasional large expense resulting from a major car repair, sizable medical bills or other things of that nature. If you constantly have to dip into your long-term investments to meet these costs, you’ll slow your progress toward your retirement goals. To help prevent this from happening, try to build an emergency fund big enough to cover three to six months’ worth of living expenses. Since you’ll need instant access to this money, you’ll want to keep it in a liquid, low-risk account.

So, there you have them: some suggestions on taking the lessons of National Save for Retirement Week to heart. By following these steps, you can go a long way toward turning your retirement dreams into reality.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

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