Ubiquity

Author: Andrew Answers

After five years of experience leading a TPA call center in North Carolina, Andrew decided to move west to explore parts unknown and follow his passion of helping others. Walking through the doors of Ubiquity Retirement + Savings, formerly The Online 401(k) for the first time, he knew he’d found something special. Continuing to delight clients and partners alike and 10 years later, Andrew has been able to develop new teams, co-found a non-profit of strategic alliances, co-produce a hard-hitting documentary about the looming retirement crisis, and still had time to spread the savings gospel far and wide. Using social media and actual media alike (Wall Street Journal, Fox Business, PlanSponsor, and more), you’ll find no one who likes talking retirement more than this guy!

3 Ways to Engage a Remote Workforce

Andrew Answers / 7 Aug 2019 / Business

graphic conceptual image of laptop connecting a remote workforce

In today’s digital age, more people than ever are working from home.

In fact, a recent survey revealed that 70 percent of professionals across the globe telecommute at least one day a week.

A remote workforce opens a business up to benefits like finding a wider breadth of talent and experience, not to mention potential cost savings. But with less in-person interaction, how can HR professionals and business owners engage their employees without sacrificing their firm’s unique culture?

The balance doesn’t have to be difficult to navigate and implementing these three concepts can help your business and employees thrive.

1. Set ground rules

When you first consider starting a remote workforce, the road may seem paved with speed bumps. For example, how will you know if your employees are really working and if goals are being met? Setting ground rules can help quantify your employees’ success. Finding a way to measure how and when work is getting done helps ensure your team is being productive and contributing to the bigger picture. Start with establishing objectives and key results with all employees and updating them every six months or so. This allows employees and managers to quantitatively set goals and deadlines, providing concrete results that can be measured and analyzed. While this data is a great start, tracking employee success can’t stop there. Two-thirds of working remote is being qualitatively available. It’s one thing for your employees to accomplish the tasks on their daily checklist, but it is another thing to feel like they are engaged and available throughout the day. The level of communication your employees provide is typically a good indicator of their commitment to the job, so it’s best to encourage an environment of overcommunicating. For instance, knowing that a team member has a doctor’s appointment at 12 p.m. is helpful, but often not enough. Instead, encourage employees to share more detailed information like when they’re planning to leave, how long their commute is and what time they expect to be back online. After all, there’s a big difference between someone being unavailable for three hours versus one or two.

2. Stay connected

Technology is a great way to foster a culture of collaboration for your remote employees. With hundreds of online messaging and organizational platforms available, it is relatively easy to find one that will provide your employees the tools they need to stay connected. When our company, Ubiquity, transitioned toward having a full-time remote workforce, we saw the need for an instant messaging and video conferencing platform that enabled everyone to communicate at the drop of a hat. Email just won’t cut it when you are telecommuting, so it’s helpful to provide several avenues for communication among employees that allow them to quickly and easily access anyone within the company. That way, quick chats can seamlessly transition to full-on video conferences and no one feels left without a way to be seen and heard. Consider making virtual meetings a consistent weekly or monthly priority. Host formal “town hall” meetings where all employees can share their performance progress and accomplishments. Stay connected on a personal level by sharing birthdays, work anniversaries and other notable milestones or by setting up a “virtual break room” where people can talk about their lives outside work and whatever else is on their mind. These outlets can all help spur collaboration and relationship-building among employees who have limited in-person contact.

3. Show appreciation

The first word in “human resource” is human, so it’s crucial to recognize your employees as individuals and ensure they feel celebrated for their unique contributions, even from a distance. To keep a finger on the pulse of your employees, start by introducing an employee engagement survey. These can reveal not only how employees think about their jobs, but how they feel. From there, consider utilizing a digital employee engagement tool to check in on the overall mood of your employees on a regular basis. This presents a great opportunity to start a conversation and hash out any pain points or show appreciation for their hard work. We take employee appreciation very seriously and go even further by doling out virtual “high fives” when we see a job well done, sending small seasonal gifts to all remote employees (tea and honey for the fall, flowers for the spring, etc.) and encouraging random acts of workplace kindness such as offering unsolicited praise or mentorship. These can all be huge motivators and help employees feel noticed during the daily grind.

As the American workforce grows increasingly remote, HR professionals must be ready to keep their employees engaged. You cannot build a company culture overnight, but setting ground rules, staying connected and showing appreciation can foster a workplace culture that is reflective of the people who work there.

Please note: this post originally appeared on Workforce on August 6, 2019.

As you are planning your retirement, it is fun to think about moving somewhere new, maybe even a beach destination.

However, it is essential to consider a variety of factors that will help you identify the best fit for you and your new phase of life. The factors workers most frequently say are important to their decision-making are affordable cost of living (71%), proximity to family and friends (54%), good weather (49%), low crime rates (49%), access to health care (43%), and recreational activities (41%).

If you think you have found the location for you, you may want to vacation there during different times of the year or spend a month or more there at a time, just to make sure you get the full perspective of a resident versus a vacationer.

Some experts also recommend that you open a bank account, have a medical appointment, or conduct other kinds of personal business in your selected location to make sure you experience the aspects of the culture and understand what will be available to you once you move there.

Several organizations routinely analyze data to identify the best places to live in retirement. Their research can help you evaluate the things that are most important to you when deciding whether you want to relocate retirement.

Best places to retire in the U.S.A.

Forbes’ annual Best Places to Retire list takes into consideration things like access to medical care, crime rates, air quality, unemployment, cost of living, and factors that can make for a fulfilling retirement, such as opportunities for volunteering and exercise. According to Forbes’ analysis, and its admitted preference for college towns, here are the 25 best places to retire in 2017 (listed alphabetically).

  • Athens, Georgia
  • Bella Vista, Arkansas
  • Bethlehem, Pennsylvania
  • Boise, Idaho
  • Brevard, North Carolina
  • Clemson, South Carolina
  • Colorado Springs, Colorado
  • Fargo North Dakota
  • Grand Prairie, Texas
  • Green Valley, Arizona
  • Harrisonburg, Virginia
  • Iowa City, Iowa
  • Jefferson City, Missouri
  • Lawrence, Kansas
  • Lewiston, Maine
  • Lincoln, Nebraska
  • Maryville, Tennessee
  • Ocean Pines, Maryland
  • Peoria, Arizona
  • Port Charlotte, Florida
  • San Marcos, Texas
  • Savannah, Georgia
  • Summerville, South Carolina
  • The Villages, Florida
  • Wenatchee, Washington

Best cities to retire

If big cities are more your style, you might want to look at the Milken Institute’s Best Cities For Successful Aging report.

This study considers nine factors that make the “best” city for retirees: general livability, healthcare, wellness, financial security, education, transportation and convenience, employment opportunities, living arrangements and community engagement.

It has also found that cities with colleges rank higher on quality-of-life factors that affect older adults, including economic strength and recreation. Here are Milken’s top 10 big cities for aging successfully.3

  1. Provo-Orem, Utah
  2. Madison, Wisconsin
  3. Durham-Chapel Hill, North Carolina
  4. Salt Lake City, Utah
  5. Des Moines-West Des Moines, Iowa
  6. Austin-Round Rock, Texas
  7. Omaha-Council Bluffs, Nebraska-Iowa
  8. Jackson, Mississippi
  9. Boston-Cambridge-Newton, Massachusetts-New Hampshire
  10. San Francisco-Oakland-Hayward, California

If you are more comfortable in a smaller setting, those have been ranked too. The top 10 best small cities tend to have moderate living costs, quality healthcare, educational facilities, and a community feel.3

  1. Iowa City, Iowa
  2. Manhattan, Kansas
  3. Ames, Iowa
  4. Columbia, Missouri
  5. Sioux Falls, South Dakota
  6. Ann Arbor, Michigan
  7. Ithaca, New York
  8. Lawrence, Kansas
  9. Logan, Utah-Idaho
  10. Fairbanks, Alaska

How livable is your hometown?

Ever wondered about how your hometown ranks on the list of great places to live? AARP’s Livability Index will tell you. Follow this link and type in your address or town name to find out how livable your community is.

Best warm places to retire

Even with all the conveniences that cities have to offer, many people dream of living by the beach or in a warmer climate. AARP researchers found ten great places to retire – all of which boast at least 250 days of sunshine each year. Other factors considered include cost of living, the range of activities for retirees, and a low crime rate.4

  1. Asheville, North Carolina
  2. Grand Junction, Colorado
  3. Sarasota, Florida
  4. San Diego, California
  5. Las Cruces, New Mexico
  6. San Luis Obispo, California
  7. St. George, Utah
  8. Santa Fe, New Mexico
  9. Bend, Oregon
  10. Fort Worth, Texas

Best places in the world to retire

If you are thinking more globally, International Living’s Annual Global Retirement Index measures factors that are important to those who are considering a move to another country, including ease of buying property, ease of attaining a visa, cost of living, entertainment, healthcare, climate, and governance. Here are the top 10 international locations for retirees in 2018.

  1. Costa Rica
  2. Mexico
  3. Panama
  4. Ecuador
  5. Malaysia
  6. Columbia
  7. Portugal
  8. Nicaragua
  9. Spain
  10. Peru

Learn more

Despite some locations showing up on multiple lists (Lawrence, Kansas, and Iowa City, Iowa), researchers have identified places all over the U.S. and the world as great places for fulfilling the needs and desires of retirees. Wherever you decide to live, you will need retirement income to support your lifestyle.

If you’re a small business owner and need a 401k plan for yourself and your company, only Ubiquity offers flat-fee plans plus free expert advice. We’ll fully customize your 401k to meet the specific needs of your small business.

Check out our cost-effective, plan solutions

Resources for best places to retire

  1. Transamerica Center for Retirement Studies: Wishful Thinking or Within Reach? Three Generations Prepare for “Retirement,” December 2017
  2. Forbes: 25 Best Places to Retire in 2017
  3. Milken Institute Center for the Future of Aging: Best Cities for Successful Aging
  4. AARP: 10 Great Sunny Places to Retire
  5. International Living: The World’s Best Places to Retire in 2018

Small Business 401k Misconceptions

Andrew Answers / 11 Jan 2018 / 401k Resources

The Small Business Owner

There are many small business 401k misconceptions which are largely due to small business owners having a lack of time, budget, and information on the subject.

In the past, small businesses have had few retirement plan options such as 401k plans that were built for their needs and those of their employees. The industry has had no problem marginalizing small businesses in favor of large ones with huge plan assets available in their 401k.

The good news is that that is rapidly changing. Still, many small business owners buy into 401k misconceptions.

Let’s put those to rest:

401k plans are time-consuming and designed for big businesses

Unfortunately, many small business owners are under the impression that 401k plans are a one-size-fits-all benefit that can’t be customized to meet their needs without the commitment of significant time and high fees.

There are plans available to small businesses that were designed with their needs and employees in mind. No longer do small businesses have to accept plans that are built for the needs of large corporations with hundreds, if not thousands of people. Nowadays, small business 401k plans exist that are customized for businesses with 50 or fewer employees. There are even 401ks built specifically for sole proprietors, known as a Solo 401k.

As far as the perceived time commitment, those same plans can be up and running in minutes if not a couple of days and require only a half hour each month to maintain.

Employer matching is a must

Even though matching employee contributions is a great way to recruit and retain talent, it’s not a requirement.

If a small business owner doesn’t want to or can’t afford to match, that’s perfectly fine. As an employer, you are already offering a wonderful service to employees by implementing a plan – matching, while there are tax benefits that come along with it, is simply icing on the cake.

For your hard-working employees, at the end of the day, some savings is better than no savings.

401ks are too expensive to implement and maintain

We know the thought of extra administrative fees weighs heavy in the minds of small business owners. Though there is some relief–through a tax credit—up to 50 percent of the cost to set up and administer the plan.

Ultimately, a plan’s cost depends on the bells and whistles that come with it—some basic plans can cost as little as $115 a month – that’s less than what your business likely pays to fill the water cooler!

High fees and poor advice are just part of the deal

Small business owners face many challenges and work way more than the average person to keep their business running efficiently. Why then do some retirement industry companies still expect you to settle for an inferior plan that charges exorbitant amounts and doesn’t offer solid advice on how to invest? Just because you may have fewer employees does not mean your retirement plan should suffer.

When the right plan is selected, small businesses are able to access low cost, effective funds for their 401k plan. No longer will small businesses and their employees settle for poor performing, high-cost funds that just absorb returns.

Likewise, employees should not feel like they’re alone and in the dark when selecting the retirement plan that will hopefully lead to their dreams coming true.

Small business owners shouldn’t be misled and buy into common myths that will discourage them from offering a 401k plan. Giving your employees a way to save for their retirement is a cheap and easy way to attract and retain talent and maintain an edge over the competition. For employees, participation in a 401k plan is a simple, effective way to save for retirement.

Get the Definitive Small Business Guide to 401k 

Everyone is guilty of falling into bad habits, especially given the fast-paced world we live in. While juggling our careers, families and other personal responsibilities, it’s easy to forget to take care of ourselves and we frequently lose focus on long-term goals.

Oftentimes, that lifestyle negatively affects our finances, and before we know it, we’ve fallen into a pattern that threatens to derail our future.

No one is immune to becoming a victim of bad financial habits. Wondering if you are guilty? Here are three common ones that can affect anyone.

1. Ignoring the status of your finances

Whether your finances are stellar or unsatisfactory, it’s important to keep a pulse on them and consult with a professional so you stay in good financial shape. Too often, people bury their heads in the sand and try to enjoy blissful ignorance when it comes to their finances – but it never ends well.

This bad habit affects people on both ends of the spectrum: For example, someone can be in a tremendous amount of debt and may ignore seeking a solution to avoid confronting the realities of their situation. On the flip side, if someone is well off, they may miss the opportunity to save money that is already at their disposal.

The way to overcome this bad habit is to start paying closer attention to your finances. Regardless of whether you’re living paycheck-to-paycheck or if money is no object, you need to be keenly aware of your spending and saving patterns, and, if necessary, adjust them so you’re on the right course.

A big component of this bad habit is that people avoid talking about money with their spouses and families, but this is an extremely dangerous rut to fall into, especially for those who are in trouble financially – staying hush-hush won’t solve your problems.

While these conversations can be uncomfortable, it’s important to make them happen.

2. Believing you’re already maxing out your savings

Sometimes, when peoples’ finances are in a good spot, they get complacent and start to spend frivolously. It’s certainly important to reward yourself for your hard work, but you should also focus on saving extra money when you can.

You might be tempted to spend bonuses, tax returns and other windfalls on vacations or shopping sprees when you know you’re already allocating a certain amount to your nest egg. However, don’t get tricked into the mindset that extra cash should burn a hole in your pocket just because you are already contributing to retirement savings.

Find a balance between steadily contributing to savings and enjoying life. Know that you can always stash some extra cash away in a 401k (the max contribution limit is $18,500/year for people under 50 in 2018), in an IRA or in a rainy day fund. You never know when it will come in handy!

3. Not updating your retirement savings strategy

Have you recently moved, started a new job, got married or had children? These are examples of times when it is important to check in on your financial plan and make sure your retirement savings strategies are appropriate for how your life has changed. It’s your retirement and it’s up to you to take charge.

While some of these milestones in life can be overwhelming, it’s important to ask yourself: What can I afford to save? There is certainly a domino effect to outdated savings strategies that don’t reflect your current and future life and those in it. If you don’t take the opportunity to revise how you save now, you could be missing out on keeping hard-earned dollars down the road.

Download Ubiquity’s Definitive Guide to Small Business 401k

This week’s question comes from Casey who asked whether you need a spouse’s consent before taking a loan from your 401k.

While we always stress the importance of leaving your money in your retirement account, sometimes unforeseen expenses arise where you need to borrow or loan yourself money. Here, we answer Casey’s question and give some other great tips on the deal with taking a loan from your 401k!

Get more on 401k by downloading our Definitive Small Business 401k Guide

What comes to mind when you hear the word “retirement”? Perhaps you picture spending all of your days with family – playing daily rounds of golf, traveling the world or enjoying an endless stream of beachside cocktails. Ultimately, people equate retirement with relaxing – not with collecting a paycheck.

However, what if in between the leisurely activities you voluntarily chose to work throughout your retirement? There are actually some valid reasons for having a job throughout retirement, regardless of whether it’s part- or fulltime. Here are three:

1. You’ll stay active.

Sure, the idea of 24/7 relaxation and having no responsibilities sounds great in theory, but the reality is that many retirees are used to having a routine, and will get bored soon after retirement.

Having a job is a way to maintain your social structure. We’re not suggesting you have to continue working in the same field, especially if it was a high-stress career. Instead, choose something that allows you to be involved in your community and interact with others. Just because you retire, doesn’t mean your social life needs to as well.

2. You’ll receive a steady cash flow.

People who are about to retire, or have already retired, are very cognizant of their cash flow. If you’re no longer collecting a steady paycheck from a job, where will your money come from? Retirees rely on items such as rental properties, investments, patents, Social Security or any number of things, but the most reliable source of income is a job.

By working throughout retirement, you’ll maintain a steady cash flow. This is especially useful to retirees who are wholly dependent on Social Security, which unfortunately can’t always pay all the bills.

Even if you have cash flow sources outside of Social Security, the income generated by a job can help you pay for luxuries during your time off.

3. You can Influence what you leave behind.

No one wants to leave behind a legacy that includes outstanding debt, especially because your kin will become responsible for it. When you are about to retire or are in retirement, it’s really important to reflect what you’re leaving behind.

If you are entering retirement and still have outstanding debt, one way to whittle it down quickly is to work, especially if you choose a job that intersects with a hobby. You won’t have to worry about the debt going unpaid and will be doing something you enjoy at the same time.

Certainly, the decision to continue working throughout retirement is a very personal one. However, many retirees find it enjoyable due to the social interaction, continued responsibilities and financial advantages.

Have you ever heard of the three-legged stool of retirement? Back in our parents’ and grandparents’ time, this is how the sources of retirement income were explained: Social Security, pensions, and personal savings.

While this model may still be floating around in personal finance textbooks, it’s as outdated as a 1970s leisure suit. The truth of the matter is two of these three stool “legs” are not as supportive as they once were and most savers today cannot rely on them for their retirement success. To make matters worse, the remaining leg of the stool is failing people left and right because they don’t realize the other two legs don’t exist anymore.

So what happened to the stool to make it a pogo stick – and a very unstable one for many people, particularly Gen-X and Millennials?

1.     The future of Social Security is not in “our” hands

The first leg of the stool that is uncertain is Social Security.

Younger generations may think they can rely on Social Security based on what is taken out of their paychecks each pay period, but the system is looking sparse due to a large number of Baby Boomers filing for Social Security – in fact, 10,000 Boomers per day.

As it stands, Social Security is projected to be insolvent by 2034. Ultimately, the lifespan of a supportive Social Security system remains a political hot potato.

2.     Company Pensions won’t save you

Only a few lucky individuals can look forward to receiving a pension once they retire. In fact, only one in five private sector employees has access to a defined benefit pension plan. Even successful companies such as Boeing, Clorox, and Lockheed Martin have either frozen this benefit or trimmed it completely out of their budgets.

This leg has basically been nonexistent for years as more and more companies swap out a defined benefit plan in favor of a defined contribution plan – putting the onus of retirement income squarely on your shoulders.

3.    Personal savings are woefully inadequate

The last – and only somewhat-reliable – leg of the stool left are personal savings.

Unfortunately, many people don’t plan accordingly for this new reality. Unlike the other two legs on the stool – which, as we already covered, are pretty much non-existent anyway – personal savings is not something that another person or entity is responsible for providing. This is the leg of the stool that you alone must plan for.

You can only control the controllable, and that starts with your personal savings strategies. Don’t wait for the Social Security system to fix itself and employee pensions to make a comeback (Spoiler alert: That’s never happening). Your future is in your hands!

How Compound Interest Works

Andrew Answers / 27 Sep 2017 / Personal Finance

Stacks of coins growing

What is Compound Interest? 

Merriam-Webster defines compound interest as:

Interest computed on the sum of an original principal and accrued interest.

Let’s put that in friendlier terms. Compound interest gives you interest on top of your original investment and additional interest.

Imagine you have $100,000.00.

If you were gaining a 10% annual return, then you would end up with $10,000 added to your original investment. In this case, your end balance would be $110,000 in year one.

In year two, the markets are great, and you are getting a 10% rate of return on $110,000, leaving you with an ending balance of $121,000. You earned $10,000 in year one. You earned $11,000 in year two. In year three, using this same math, you’d earn $12,100.

If you carry that out for 30 years or more, you could be sitting on a very comfortable nest egg.

Learn more about how much you should be saving for retirement

5 Steps to 401k Rollover

Andrew Answers / 24 Sep 2017 / 401k Resources

Hands stretched out on a laptop working

Congrats! You’ve got a new job, your desk is packed, and you’re ready to fully embrace a new chapter in life. But are you leaving your 401k behind? Here is your step-by-step guide to 401k rollover:

1. Check if your new employer has a retirement plan.

Even if they’ve got one, there are a handful of plans that don’t allow you to rollover funds from an old plan. If your new job offers a 401k that accepts rollovers, you’re safe to move on to the next step!

2. Get documents from your old 401k plan and start contributing to the new!

Contact your previous employer and get the necessary documentation that says what you want to do with the money from your old plan, such as move it to your new plan, keep it in place, or roll it over into an Individual Retirement Account (IRA).

NOTE! If you rollover your funds directly to another plan, you won’t be taxed. If you take a direct distribution, taxes will be assessed and you’ll also be hit with a 10 percent penalty for withdrawing money prior to retirement.

Take your time to consider the implications of the move – oftentimes you’ll experience a lot of jargon such as plan sponsor, trustee, and tax implications, so make sure you understand everything before filling it out.

3. Keep an eye out for the check.

If you requested a rollover or direct distribution of your old 401k), a check will be mailed to you. Who the check is made out to is very important.

If you requested a rollover, the check should be made out to your new plan custodian (for example, Ubiquity uses Charles Schwab, Matrix, and TD Ameritrade). The custodian is the entity that holds your money until you retire. If the check is in your name and you requested a rollover, something went wrong and you need to contact your prior employer’s plan custodian immediately.

If you requested a direct distribution and receive the check in your name but are reconsidering rolling the money to the new plan, there’s good news! As long as you don’t deposit the check, you have time to decide if you’d rather it go toward another 401k instead of taking the direct distribution and incurring the fees and taxes associated with that decision.

NOTE! A retirement plan provider (like Ubiquity) is simply an intermediary during this process. The plan provider does not cut the check. While you can contact your plan provider for help during this process, including to ask about the status of the check, their role is limited to forwarding your inquiry along to the custodian.

4. Alert your new employer about the rollover.

After you have the check – and it’s made out to your new plan’s custodian – talk to your new employer and update the appropriate person about the status of the rollover. Your new plan provider needs to be notified by your employer that the rollover money will be hitting your account. If they don’t know, then the new plan won’t look for money and that deposit will not be approved.

NOTE! That check you received then needs to be mailed to the new custodian. You can either handle that yourself or ask your employer to take care of it.

5. Make changes to plan investments if you choose!

Your new rollover money is a fresh start – choose new funds, contributions, or discuss with a financial advisor your options.

Rolling over your 401k is important because you don’t want to lose momentum saving or jeopardize compound interest. As long as you follow this checklist, you’ll stay on track to achieve a healthy retirement.

Download Your Definitive Guide to Small Business 401k

Retirement on a Shoestring

Andrew Answers / 8 Aug 2017 / Personal Finance

Retirement? No. Work till your dead? Yes.

My father is older than my mother, although he is very much like the glamorous southern bell that admits his age to NO ONE. He had the tiniest pension in the world from his jet-setting career that may or may not have been used to purchase a house, and so, retirement is Social Security.

My traditional family halted dramatically when he chose to chase dreams rather than a paycheck. I mean, not that dad isn’t a show-stopping artist, because he is. And in his hay day, he was making some pretty large bills on paintings, because people used to have money to blow on art. Do you remember those days? You know, before the downfall of our economy, when we all had tons of (pretend) money?

Here’s a timeline of events:

  • Dad quits the job, becomes an artist, we move to Maui because Oregon’s economy went through a major bottoming out.
  • We live in a house the size of a shoebox (700 sq. ft.) and there are amazing amounts of tourist dollars from all over the world flowing through the island. Unrealistic sums of money. The kind you wipe your tears of joy with – if any of it was yours…
  • Hawaiian market bottoms out, my mother would like to be closer to her aging parents and sisters, and we move back to the family farm, which, if you are a Harry Potter fan, looks like the Weasley House.
  • Dad retires with a savings account in the teens (as in five-figures) and takes Social Security, which is well below the national average check of around $1,200 – in fact, it’s less than half of that.
  • Mom gets a job that she still works at today, and has a 401k plan through her work.
  • Health premiums are through the roof! Dad gets on Medicare, mom stops paying over $1,000 per month for his insurance.
  • Even with Medicare, dad and mom pay more in healthcare premiums than all other bills combined.

Okay, that brings us to a pretty current status. Mom works like a mad woman and supports my dad. She cooks, cleans, sews… all the stuff that moms used to do traditionally. She also has a firm grip on what it’s going to take to retire – for both of them.

Her 401k is the ONLY thing that ensures they have a future at all. Despite the fact that the market tanked and she lost over half of her savings – she spoke with her Advisor, and he said the following:

“Stay the course.”

Good advice. She did, and now her 401k has bounced back to where it was and on her current trajectory, she’ll be able to retire at around 66 (though she is going to try to wait to 70). Her house is paid off, but unfortunately, it is in the middle of nowhere, about 30 miles away from the nearest hospital, riddled with scary stairs, and lots of farm work…

I’ll tell you what’s going to happen. Our family is going to combine. Aunts, uncles, sisters, cousins, friends, whomever – we’ll live under one gigantic roof and combine resources. We’ll create the family compound and take care of one another. And it won’t be taboo anymore. Kids moving back home or parents moving in with kids will be the new show of success. If other countries can make it a successful go, so can we.

Congrats! You graduated college and accepted your first full-time position. The transition from college life to “the real world” can be quite challenging and, at times, confusing. However, right before you rush through that HR paperwork, realize that those forms may hold the keys to your first retirement plan.

Namely, your first 401k plan. Even though retirement seems like the last thing a new college grad should be thinking about, your commitment to your future starts now. By enrolling in your new employer’s 401k right off the bat, you are taking a giant step toward complete financial independence.

You might be done with classes, but don’t give up on learning just yet, especially when the subject is your future! Check out this 401k 101:

Look into your enrollment options.

Despite when your first day of work was, your enrollment period might not begin for another few months or even a whole year. Every company operates on a different enrollment schedule.

If you can’t enroll immediately, check with HR on when you will become eligible. Set a reminder on your calendar to revisit the open enrollment discussion when it gets closer to that period.

Why? Letting this slip off your radar will cause you to miss out on a tax break and compound interest (more about this below) — which is like flushing money down the toilet!

Find a happy medium in your involvement.

When it comes to your money, no questions should be off-limits, especially if you are new to your employer’s 401k plan. Take advantage of your plan provider’s representatives who are there to advise you on the nuances of your plan, investment choices and company match options during the open enrollment period.

Don’t discount the power of compound interest.

As you may have learned in your college economics class, those who begin saving earlier will wind up with more cash. This concept is called compound interest. Think about it this way: The earlier you save, the more vacations you will be able to go on in retirement (hello, world traveler)! It might seem like those first few dollars you save are entering a black hole, but your assets, or shall I say “vacation fund,” will build over time.

Don’t give up so easily.

Some companies, unfortunately, don’t have a way for you to save for retirement at work. While that’s a huge bummer, there are still options for you. Don’t shrug your shoulders and give up on your future – there are viable, easy solutions!

Turning to your local bank to begin an Individual Retirement Account (IRA) is likely your best bet. In an IRA, you still have the ability to invest pre-tax dollars. Not only do you give yourself the opportunity to save, but your bank may also be more likely to loan you money in the future because you are establishing positive financial habits from the get-go.

Hopefully you have a better idea of how to go about enrolling in and taking advantage of your first retirement plan. You not only passed college, but you just aced 401k 101.

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© 2020 Ubiquity Retirement + Savings
Privacy Policy
44 Montgomery Street, Suite 3060
San Francisco, CA 94104
Support: 855.401.4357

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