Tariff concerns has many concerned about their retirement accounts.
BUFFALO, N.Y. — There are many questions about 401(k) retirement savings accounts.
Anthony Ogorek, of Ogorek Wealth Management, said if anyone is planning to retire soon remember, ‘it’s a very difficult time.’
“The first piece of advice is you need to understand what you own,” Ogorek said. “It’s your life and it’s incumbent upon you to take responsibility for that. You can’t control external factors that are going on, but you sure can control what’s going on in your own neck of the woods, which is your account.”
If you’re planning to retire soon, Ogorek said, “the good news is in a retirement account, you can make allocation changes, but you’re not going to be hit with any taxes because you’re in a tax deferred account. It’s a tougher call for people who’ve gotten, you know, considerable gains in their brokerage accounts and now if they end up selling, that’s going to generate a big tax bill for them.”
What should I do about my 401(k) if I’m in my 20’s or 30’s?
Ogorek said: “If you’re in a relatively low tax bracket, maybe consider putting money into a Roth 401(k) rather than a traditional. You will not get a current tax deduction for it. However, any money you put in there is going to accumulate tax free, and when you pull it out, it’s also going to be tax free.”
He says the more shares you accumulate over your working lifetime, the better off you’ll be.
What should I do about my 401(k) if I’m in my 40’s or 50’s?
“You’re still in a growth phase, look at your allocation and if you were 100% in stocks, maybe you want to throttle that back to, you know, 70% 65% or 60%, something of that nature and your risk profile is going down. Little bit more continue to reinvest dividends in the account, continue to make contributions as you can.”
He advises putting at least 10% of your pay into a plan.
What should I do about my 401(k) if I’m in my 60’s?
Ogorek says you’re likely going to be ready to take money out, meaning “you probably are approaching or you’re going to be in a distribution phase. If you’re taking a draw from the account or a monthly draw to live on, you probably should have at least one year’s worth of expenses in cash so that you don’t have to hit depreciated shares in the event the market goes down.”
“You may have the opportunity to move some assets from your 401K to a Roth IRA. In the event you do that, you are going to pay current income taxes on the distribution you take. However, anything in that Roth IRA is not taxed as it continues to grow and any funds you take out down the road also are not going to be taxed.”
Ogorek says know what you own. Remember it’s your money.