early IRA withdrawal penalties Archives - ROI TV

The Ultimate Money Makeover: Retirement Planning Strategies to Secure Your Future

Joe Anderson — Tue, 29 Apr 2025 13:10:51 +0000

Retirement should be your reward for decades of hard work—not a time of stress about money. But without the right planning, rising costs, tax changes, and market ups and downs can derail even the best intentions.

In this Money Makeover session, financial experts we broke down how to build a stronger retirement plan that balances smart saving, smart spending, and smart investing.

Here’s what you need to know to get your finances makeover-ready.

1. Retirement Planning Starts with Setting Clear Goals

Many people enter retirement without a clear plan—and it shows.

Between 2016 and 2021, the average retiree’s monthly expenses rose by $1,000.
49% of retirees spend more than they anticipated.
Retirement often feels like “Saturday every day,” leading to more discretionary spending.

The first step: get clear on your goals.
When do you want to retire?
How much do you want to spend?
Do you plan to travel, buy a second home, or fund grandkids’ education?

Answering these questions is the foundation of a sustainable retirement plan.

2. Budgeting: Needs First, Wants Later

Americans are currently spending $7,400 more per year than they earn—a dangerous trend.

A simple rule can help you stay on track:

50% of income for needs (housing, healthcare, food)
20% for savings
30% for wants (travel, hobbies, entertainment)

Following this structure before and during retirement helps prevent lifestyle inflation and debt accumulation.

3. Retirement Savings: Employer Matches and Beyond

Good news: 52% of employees are now saving above their employer’s match.

Vanguard’s study shows that raising your contribution rate even a little each year makes a huge difference.

Saving 2% of your salary could grow to $119,000.
Saving 6% could grow to $356,000—nearly triple.

Aim for 15%–20% of your annual income if possible. And always grab the full employer match—it’s free money.

4. Tax Planning: Take Advantage of Current Low Rates

Tax brackets are expected to rise in 2026:

22% bracket → 25%
24% bracket → 28%
32% bracket → 33%

Use today’s lower brackets to your advantage:

Convert traditional IRA funds to Roth IRAs
Diversify your retirement income streams
Invest aggressively in Roth IRAs for tax-free growth

Roth conversions might cause a short-term tax hit—but they can save you tens (or hundreds) of thousands over a lifetime.

5. Consolidate Accounts to Simplify Life

Many retirees have a hodgepodge of accounts—old 401(k)s, IRAs, brokerage accounts.

Consolidating can:

Reduce management headaches
Lower fees
Simplify required minimum distributions (RMDs)
Make tax filing easier

Consider using low-cost custodians and ETFs to streamline your investments even further.

6. Avoid Early IRA Withdrawals

Need cash? Think twice before tapping your IRA early.

Pulling out $100,000 before age 59½ could cost you $38,000 in taxes and penalties. Worse, that lost money could have grown into hundreds of thousands if left invested.

Build an emergency fund and short-term savings outside of retirement accounts to avoid costly withdrawals.

7. Stress Test Your Retirement Plan

Case studies like John and Sally (age 57) show how easily a plan can fall apart without proper testing.

Their original strategy depleted funds by age 82.
But by working a few more years, saving more aggressively, or reducing discretionary spending, they could extend their nest egg through their entire lifetimes.

Stress testing helps you uncover weak points—and fix them before it’s too late.

8. Use Financial Tools and Get Educated

Budget templates
Retirement calculators
Portfolio risk assessments
Tax planning strategies

Financial education and action go hand in hand. The more you understand your money, the better decisions you’ll make for your future.

Final Thoughts: Your Retirement, Your Rules

A great retirement isn’t just about how much money you have—it’s about having a plan that aligns with your goals, your values, and your vision for life after work.

With the right mix of saving, spending, investing, and tax planning, you can enjoy the retirement you’ve earned without unnecessary stress.

Start your financial makeover today—you deserve it.

Intended for educational purposes only. Opinions expressed are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Neither the information presented, nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Consult your financial professional before making any investment decisions. Opinions expressed are subject to change without notice.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.

The post The Ultimate Money Makeover: Retirement Planning Strategies to Secure Your Future appeared first on ROI TV.

Retirement Planning Strategies for 2025

Joe Anderson — Tue, 08 Apr 2025 11:24:45 +0000

If you’ve been feeling unsure about your retirement plan—or haven’t made one at all—you’re not alone. On this episode of Your Money, Your Wealth, I sat down with Joe Anderson, CFP®, and Big Al Clopine, CPA, to unpack what retirement planning really looks like in 2025. From financial makeovers to smart tax strategies, we broke down practical ways to help you retire on your terms.

Why a Retirement Makeover Matters Now More Than Ever
Inflation, market swings, and increased longevity mean our money needs to stretch further than ever. Just consider this: in 2016, average monthly expenses were around $3,500. By 2021, that number had jumped to $4,500. That’s an extra $12,000 per year! No wonder nearly half of retirees today say they’re spending more than they expected.

That’s why having a clear, documented financial plan is essential. Yet, only 17% of Americans have one in writing. A solid plan keeps you on track and gives you the power to course-correct when life throws surprises your way.

Benchmarks by the Decade
Not sure if you’re on track? Use these savings benchmarks as a rough guide:

By your 40s: aim for 3x your annual income
By your 50s: 6x
By your 60s: 10x

So if you’re earning $100,000 a year, you’d want around $300,000 saved by your 40s and $1 million by retirement. These aren’t hard rules, but they’re great starting points—especially when you factor in Social Security or a pension.

Stress-Test Your Retirement Plan
A financial plan isn’t “set it and forget it.” It needs to work under different assumptions—like higher inflation or lower market returns. We looked at John and Sally, both 57, with $1 million in 401(k)s and $50,000 in cash. Spending $140,000 a year, they ran out of money by age 82. Working longer, spending less, or downsizing their home could change that dramatically.

Avoid the Hidden Costs of Early IRA Withdrawals
Thinking about tapping into your IRA early? Be cautious. Taking $100,000 out before age 59½ could cost you $38,000 in taxes and penalties—especially if you live in a high-tax state like California. That’s money that could’ve grown for decades had it stayed invested.

Streamline and Simplify with Account Consolidation
Multiple 401(k)s and IRAs can make managing your retirement messy. Consolidating accounts not only reduces paperwork and fees but simplifies your required minimum distributions (RMDs) later on. Instead of juggling separate RMDs for each 401(k), you’ll only need to calculate one for all your IRAs.

Don’t Leave Free Money on the Table
If your employer offers a 401(k) match, make sure you’re contributing enough to get the full benefit. Even small increases matter. One example showed how bumping contributions from 2% to 6% boosted savings from $119,000 to $356,000 over time. Ideally, you should aim to save 15–20% of your income, but starting small and building up works too.

Why Roth IRAs Should Be Part of Your Tax Strategy
Most people stash retirement savings in tax-deferred accounts like 401(k)s—but come retirement, those withdrawals are taxed as ordinary income. That’s where Roth IRAs can shine. Contributions are taxed upfront, but qualified withdrawals are completely tax-free. They’re especially great for stocks or high-growth investments.

And here’s the kicker: tax brackets are scheduled to go up in 2026. That makes now a smart time to explore Roth conversions and lock in lower tax rates while you can.