Life Planning and Retirement Readiness
Why Should I Learn More About Supplemental Retirement Savings Plans Like 403(b) and 457(b)?
Challenging economic conditions have led most employees to worry about whether or not they will ever be able to retire, and those who have lost their jobs have even bigger worries (see Findings from National Voter Survey: Americans Anxious About Retirement Security, published on 10/12/2011 by BenefitsLink.com). Developing a better understanding of your own situation with respect to retirement, evaluating current lifestyle and desired retirement lifestyle, and charting a course to reach your goals are activities worthy of your attention. There is no time like the present to get started.
Numerous organizations provide information that focuses on educating employees about retirement financial planning, and how 403(b) Tax Sheltered Annuities (TSA) and 457(b) Deferred Compensation Plans (DCP) are excellent supplemental retirement savings programs (see dedicated section below). Rewarding lifestyle choices, balanced between the working years and the retirement years, are isolated and emphasized on this page.
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Life Planning vs Financial Planning
Financial planning, while important for both overall life planning and retirement planning, is not the only critical consideration. In fact, a good case can be made that finances aren't even at the top of the life/retirement planning priority list. Along these lines, "providing financial and physical shelter" is only one of six issues and concerns in what we call a SPLASH model:
Spirit: What matters beyond the physical details of your life
Purpose: Activities that give meaning to your daily life
Love: Your connections to others you care about
Avocation: What else gives you joy and satisfaction
Security: Providing financial and physical shelter
Health: Taking care of your physical and mental well-being
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Retirement Planning
The Three-Legged Stool: Generally speaking, retirement income is generated from three sources:
- Employee Pension Plans [like PERS];
- Social Security; and
- Supplemental Retirement Savings.
Ordinarily, the first two legs of this stool are insufficient for continuation of pre-retirement standard of living through the retirement years. Your employer offers excellent tax deferred supplemental retirement savings plans as one option for you to add this third leg to your "retirement income stool."
Shaky First Two Legs: For various reasons (e.g., generous guaranteed benefits and substantial investment losses), State Pension Plans are under pressure to reduce unfunded liabilities by reducing pension benefits to participants. The Social Security System is constantly under review and many fear that benefits will be less than anticipated. Hence, it is prudent to anticipate the need for additional retirement income and take action now to meet that need. Tax deferred savings through your employer's 403(b) and/or 457(b) plans is an excellent way to take such action.
Shaky First Three Legs: Even following careful planning and supplemental savings, many individuals approaching retirement find their expected retirement income to be insufficient to support their desired lifestyles. Moreover, even individuals for whom expected retirement income exceeds what would be required to support desired lifestyles find that they desire continued employment to fulfill psychological needs. Consequently, it has become commonplace for some individuals to delay retirement, phase into retirement, or simply continue working until they become unable to do so due to physical or mental decline. Continued part-time or full-time employment can be considered one leg of The Four-Legged Retirement Income Stool.
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Professional Advisors: Different Purposes Require Different Skills
Many of us secure the services of Attorneys to prepare last wills and testaments and handle other legal matters, CPAs to prepare our income tax returns, Realtors to guide us through the purchase or sale of our homes or other properties, and even Personal Trainers to help us shed unneeded pounds. Unless you are one of the very few who have the knowledge necessary for professionally managing your finances AND are willing to devote the requisite time and energy to do so, we believe it makes sense to secure the services of a qualified, licensed, and trusted Financial Advisor to guide you through the lifelong financial minefield we all must traverse. Moreover, recent emphases on holistic approaches to life planning have led to professionals generally called Life Coaches entering the field of professional advisors.
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Employee Logins and Interface
Retirement financial planning involves monitoring progress toward retirement income goals. Numerous tools are available for ‘do-it-yourself’ individuals and financial advisors have access to comprehensive planning tools for their clients. As a step in the direction of providing basic information to employees who participate in their employer’s supplemental retirement savings programs, CCC makes available Employee Login User Accounts and Employee Interface Website Pages that allow you to create a login account and securely login on the CCC website. If employee login user accounts are available at your employer, you have created a login user account, and you are logged in, then you can review:
- Your login account profile information and make changes when appropriate;
- The human resources information provided to CCC by your employer;
- Your applicable annual 403(b) elective deferral limit for the current year;
- Your year-to-date 403(b) elective deferrals to date if you are currently contributing;
- Your current and previous online salary reduction agreements if your employer allows CCC online enrollment;
- Any plan transactions in process or completed by CCC on your behalf (distributions, exchanges, loans, etc.);
- Account balances for accounts with Vendors that provide SPARK data to CCC;
- Distributions from accounts with Vendors that provide SPARK data to CCC; and
- Current year-to-date and previous year 403(b) & 457(b) contribution information provided to CCC by your employer.
If employee login user accounts are not available at your employer and you would like to request that they be made available, Contact Us and we will notify your employer of your interest.
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Consumer Education Links
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Retirement Calculators
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Online Articles
Under Development
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Software for Financial/Life/Retirement Planning
Economic Security Planner (ESPlanner) "ESPlanner builds a personal lifetime financial plan - whether you are just starting out, nearing retirement, or already retired."
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Links to Vendor Educational Web Pages
Links to the Helpful Employee Resources websites of those Vendors that have provided URLs for such websites:
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