Do you have a plan for your future?

The way I see it, today a person has two options if they want to retire someday financially secure in Northern California. The person I am talking about is someone who will never inherit millions of dollars and a person who will not receive a very substantial government pension. The reason I mention Northern California is because these two options may be different for a person who moves to Kansas or Arkansas after they retire. The folks I am talking about are the majority of our population who only have Social Security guaranteed for their income after they turn 65. Option No. 1: One way to assure financial security is to make sure your home is free and clear and that you have absolutely no other debt when you retire. Social Security may not be enough income to cover your monthly expenses, but if you own your home free and clear, then you can at least be in a position to sell the home and move down to a smaller, less-expensive home and pocket the difference. This extra money could be tax-free under today’s capital gains rules for both single and married people. You should consult a tax professional or estate lawyer when doing anything that has to do with taxes. This extra money leftover would have to be handled and invested carefully because people are living a lot longer today and everyone would like to outlive their money. Option No. 2: Make sure you have enough wealth and equity in your investments like real estate, mutual funds, stocks, cash and bonds to live off the return on these investments to maintain your lifestyle and budget. For those of us who are self-funding their retirement, the key is investing monthly and getting started early in life. In addition to maximizing your IRA and 401(k) contributions, it is critical to invest in other vehicles also and, again, this is why I suggest a qualified certified financial planner to assist with your plan. Whichever option applies or if a person can do both options, then it is likely the retirement years will be a happy time for you and your family. In either instance, it is always important to look ahead and make sure you have a plan of action to assure your results to the greatest extent possible.