Financial Plan after Retirement

Well, we all go there,” retirement”.

I retired several years ago. My husband is still working.
He is really enjoying his job having fun and no plan
to retire soon. He is 70 years old and he is a scientist.

I was a school librarian and I enjoyed reading
stories to elementary school children.

I published 6 books, mainly how to use
children’s picture books in English

I love writing, but my love of writing is far
from my husband’s excitement in his scientific
research. From money making point of view,
it's more like a hobby.

But, my husband needs to slow down. Unfortunately, we
all go down physically.

Lately, I started to pay attention to our financial
situation to think about our source of income
after my husband retires.

What will we have after retirement?
We have pensions. I worked for the public-school system
for 20 years, and my husband worked 37 years
for a scientific research lab. He retired from
there and was hired by another lab soon after.

This is a retirement fund.
Since I was a teacher, my pension comes from the
Teachers Association in our state every month.

My husband worked for a scientific lab as his first job.
His pension comes from the government every month.

But, the younger generation is not getting pensions any more except city,
state, government and military workers.

Mainly young people will receive retirement from a 401(k).

This is a very popular investment form in the U.S.
To get a full benefit, you don’t touch this investment
until you retire.

You earn compound interest, that usually includes
matching fund from your employer.

If your 401(k) investment is $250 every month,
your employer will give you a matching fund
that on the average is 6 to 10% depending
on your employer.

If this continues until you retire at age 65, this compound
interest will accumulate. It will be close to 1 million dollars.

We lost money when the stock market crashed in 2008.
But, we did not do anything with the stocks and eventually
it straightened up. The economy started to grow again.

So, if my husband retires, every month, we will receive
a pension plus a 401(k) distribution.

The 401(k) is safe as long as stock market does not have crash.
Also, if you take money before you retire you have to
pay a penalty. If you change jobs, you can start a new 401(k)
with your new employer, and you still have your old 401(k)

But, at age 70, you have to start to withdraw money. This is
called a minimum required distribution. But until you
withdraw, it is tax free!

3)Social Security
In the U.S., if you worked 10 years, you are entitled to
receive a full social security every month.

When I was working, social security was deducted from
my salary each month. Full retirement
age is 65 years. But, I became a half time when I was 62 years old,

At that time, I started to withdraw my social security .
My social security monthly payment
was permanently reduced.

But, my husband waited until he became 70 years old.
You have to withdraw when you are 70. If you wait until
70, the government will give you 8% more each year from
65 to 70.

I did not take an advantage of social security system to
pursue my hobby, writing. But, my husband did.
Anyway, both of us get Social Security every month till
we die.

4)Capital Gains
We have stocks as one of investments like most of people.
The benefit of profit is called capital gain.
Instead of investing in one big company,
we prefer S&P 500, where we invest in 500 companies.

So, We will have (Pension+401(k)+Social Security+
Investment Income Capital Gains)

These are our financial plans to support our life after retirement.
This is not unusual. Many American families have this kind of
planned income sources.

Life is not just money. But, I worked really hard when I was a
college student in the U.S., and I now feel,” I did it!”


(My hair stylist who is 21 years old,
started 401(k) as soon as she found her job
at this salon. Good for her!)





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