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Take inventory of what you have before tapping into your retirement money (part 2 of 3)

Saving & Investing
Take inventory of what you have before tapping into your retirement money (part 2 of 3)

May 29, 2020  |  by David Weis, MBA, CFS* Financial Advisor at Arsenal Credit Union

Before taking money out of retirement savings, first take inventory of what you have.

  • Consider all your choices. Take a look at our survival guide to emergency funds.
  • Begin with evaluating what you have in previous employers’ plans and IRAs. These often have received the least attention over the years and could be an opportunity to improve their performance, consolidate with other assets, or draw from. It’s worth a look.
  • Review your current employer’s plan. It’s important to understand how much you have, what flexibilities a loan offers versus making withdrawal, what you are invested in, and what your investment choices are inside the plan.
  • Analyze and evaluate your overall investment mix for all your accounts. Over time, accounts drift with market shifts. Do you have too much risk? Not enough risk? The economy, the stock market and your personal situation has all changed. Should your portfolio mix change?
  • Determine which investments are still likely to contribute effectively to reaching your goals for retirement. It’s time to reevaluate the positions that make up your investment mix.  Adjustments may be necessary. Getting this right is extremely important, but it can be complicated, time consuming and difficult. Need help understanding what’s right for you? Give me a call at 314.919.1058 to set up a call or an appointment.
  • If you are still receiving a paycheck but facing a budget crunch, simply turn off your future retirement contributions for a while. This may be a temporary fix that frees up some cash to utilize in the short term. It also allows more of your saved & invested money to keep working for you in the meantime. Letting your balance continue to work is about the simple concepts of compounding and time. Compounding provides the greatest value when applied over longer periods of time. It is simply putting the earnings that you earn on your investments to work by reinvesting it to create more earnings. Over time that might add up and could possibly contribute to your overall earnings.

Can you continue contributing for retirement now and after at pre-COVID-19 levels? It makes practical sense to continue contributions and potentially buy investments at a lower price in a market down-turn.

Absolutely keep saving and continue investing, more now if you can, as it may help make up lower balances faster when growth returns. If you don’t plan on continuing regular contributions, you may need to come up with a plan “B” for retirement. Sacrifices may be in order in retirement.

About the Author

For more than 12 years, David Weis has helped his clients develop, implement and monitor personalized financial plans. He specializes in retirement strategies and IRA rollovers for 401(k)s, 403(b)s, 457s, Profit Sharing, and TSPs. Learn more by visiting his website, or call 314.919.1058 or send an email to reach him.

*Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA / SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. The Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members.

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