Expert Interview Series: CFP Kimberly Howard on How to Save for Retirement
Certified Financial Planner Kimberly J. Howard is well-known blogger who has written on subjects ranging from 401k’s and mutual funds to debt management and saving for college. She’s also the founder KJH Financial Services in Newton, Mass. and Denver, Col. and enjoys helping clients explore and achieve their life goals through effective comprehensive financial planning.
We recently checked in with her for advice on smarter retirement planning. Here’s what she had to say:
What are the challenges of planning for retirement today?
One of the biggest challenges for retirees today is the market volatility. The lack of consistent returns leads to inability to plan a retirement budget.
What are the smartest things we can do today to prepare for retirement?
Saving early and often will lead to a better life in retirement. Looking ahead and thinking about how you would like to see your retirement years.
How should the way we save for retirement evolve as we get older?
Retirement savings in earlier years is probably in retirement accounts only. As you get closer to retirement, selecting retirement or non-retirement accounts is a factor. At this point, retirement taxable income can be projected.
What are your favorite tools or products for saving for retirement?
Saving in tax deductible and tax-free accounts is preferred. These being 401k, 403b, traditional IRAs and ROTH IRAs. Selection may be determined by your income bracket.
What tools or products would you caution your clients not to use?
Life insurance products are not the best avenue for retirement savings. Using the cash balance in the product could drain the death benefit.
What advice do you find yourself repeating over and over to clients about saving for retirement?
Start saving early and do not invade your retirement savings until retirement.
What are the biggest mistakes or oversights you see people making when it comes to saving for retirement?
Most people do not realize the retirement year’s budget may be more than the working year’s budget. New retirees have plans to do more activities with cost attached.
What do you think retirement will look like for Boomers and beyond? How will it be different than retirement for past generations?
Many Boomers will leave full-time workforce earlier than previous generations. They will continue to work part time. Previous generations left the workforce and never returned. Boomers desire a daily fulfillment that part-time work can provide.
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