How to Plan for Retirement in Your 20s November 1, 2023 For some people, planning for retirement in your 20s seems like a distant goal, something for your future self to deal with. Your 20s tend to be about building your career and having memorable experiences. The future may appear far off, but it’s never too early to start planning for retirement. In fact, your 20s are the perfect time to begin! 1. Build an Emergency Fund First Before diving into retirement savings, it’s important to build up your emergency fund. This fund serves as a safety net for unexpected expenses like medical bills, car repairs, or job loss. Aim to save at least three to six months’ worth of living expenses. Having an emergency fund ensures that you won’t have to dip into your retirement savings prematurely in case of financial setbacks. 2. Pay Off Any High-Interest Debt High-interest debt, such as credit card balances, can be a significant barrier to saving for retirement. The interest on these debts can quickly accumulate and erode your financial stability. Focus on paying off high-interest debts as a priority. Once they’re under control, you’ll have more disposable income to allocate to retirement savings! 3. Create a Plan Now that you’ve built up an emergency fund, you can start planning! The sooner you start planning for retirement, the better. Figure out your retirement goals by considering factors like when you want to retire, your desired lifestyle in retirement, and estimated expenses. Having a clear plan will keep you motivated and on track. Once you’ve decided on your goals, you can determine how you’re going to set up your retirement fund. 4. Do Not Pass Up an Employer Match If your employer offers a 401(k) plan with a matching contribution, take full advantage of it. Think of it as free money for your retirement! Contribute enough to maximize the employer match. If your employer doesn’t offer a 401(k) matching benefit, consider opening a Roth IRA. Roth IRAs allow your contributions to grow tax-free, and you can withdraw your contributions (not earnings) penalty-free in case of emergencies. 5. Consider Investing Once you’ve established your retirement account, consider investing your contributions. Investing allows your money to grow over time, thanks to the power of compound interest. While investing carries some risk, it has historically provided higher returns compared to a traditional savings account, especially long term. By diversifying your investments across different account types, you can reduce risk and potentially maximize returns. 6. Consider Life Insurance Life insurance is often overlooked when planning for retirement, but it can play a crucial role in ensuring financial security for you and your loved ones. Now is an excellent time to evaluate your life insurance coverage. Premiums are typically lower the younger you are and you may have more accumulated cash value the longer you keep your policy. Remember, life insurance isn’t one-size-fits all; there’s several options to choose from, like Whole Life, Term Life and Universal. Talk to your local OKFB agent to determine which option is right for you. Remember that the key to planning for retirement in your 20s is consistency. Even small, regular contributions can grow significantly over time. The power of compounding can turn modest savings into a substantial retirement plan. Starting early will give you a significant advantage, allowing you to enjoy a financially secure retirement when the time comes. Your future self will thank you! We’re Here to Help Whether you’re a longtime policyholder or just starting to look for insurance options, we’re here to help. If you have questions or concerns that you want to discuss, connect with your local OKFB agent today. If you have any insurance-specific questions, we would love to help you find the coverage that best meets your home, auto, commercial and life insurance needs. Don’t forget to follow us on social! This kind of information and more is just a click away. You can find us on Facebook, Instagram and LinkedIn.
How to Plan for Retirement in Your 40s November 1, 2023 When you’re in your 40s, you probably have potential to save more for your retirement. Your financial goals may shift, with saving for retirement taking precedence over building an emergency fund. The Federal Reserve averages savings for the middle age group at $27,900, with the median savings at $4,710. If you feel behind on your retirement planning, don’t worry! Keep reading for more tips for saving for retirement in your 40s. 1. Assess Your Retirement Goals As you approach retirement planning, it’s crucial to think about what life will look like when you’re retired. Your retirement intentions can significantly influence how you approach the last decade or so before retirement. Consider questions like: Where do you want to live? What hobbies and activities do you want to pursue? Are you thinking of downsizing your home? By figuring out your retirement goals, you can better tailor your savings strategy to meet your unique aspirations. 2. Estimate Your Retirement Income Take a comprehensive look at all your potential sources of retirement income, including your 401(k), IRAs, and any other investments. Ensure that these income streams align with your anticipated retirement expenses. If there’s a gap between what you have and what you need, consider making adjustments. If you’re not sure where to start, consider checking out our financial services! 3. Take Advantage of Tax Deductions The government encourages retirement savings by offering tax advantages. Contributing to a traditional IRA, for example, allows you to defer tax deductions, reducing your taxable income for the year. Keep in mind that this income will be taxed when you withdraw it in retirement, but the tax benefits can be substantial in the short term. (If you’re 50+, you may be able to use catch-up contributions on your 401(k)!) 4. Invest in Non-Retirement Accounts While retirement accounts offer tax advantages, they come with contribution limits. Once you’ve maximized your tax-advantaged retirement savings, consider investing in non-retirement accounts. Diversify your investments to mitigate risk and potentially earn higher returns. Non-retirement accounts offer more flexibility, allowing you to access funds before retirement without penalties. 5. Consider Life Insurance Life insurance is often overlooked when planning for retirement, but it can play a crucial role in ensuring financial security for you and your loved ones. Now is an excellent time to evaluate your life insurance coverage. Ensure that it’s sufficient to protect your spouse or partner’s quality of life through retirement if either of you were to pass away. Life insurance isn’t one-size-fits all; there’s several options to choose from, like Whole Life, Term Life and Universal. Talk to your local OKFB agent to determine which option is right for you. Saving for retirement may feel like a daunting task, but with careful planning, you can take significant steps toward securing a comfortable and financially stable retirement. Remember that it’s never too late to start, and by following these steps, you can build a stronger financial foundation for your future! We’re Here to Help Whether you’re a longtime policyholder or just starting to look for insurance options, we’re here to help. If you have questions or concerns that you want to discuss, connect with your local OKFB agent today. If you have any insurance-specific questions, we would love to help you find the coverage that best meets your home, auto, commercial and life insurance needs. Don’t forget to follow us on social! This kind of information and more is just a click away. You can find us on Facebook, Instagram and LinkedIn.
3 Ways to Set Your Child Up for Financial Success September 7, 2023 As a parent, you want nothing but the best for your child. One of the most important gifts you can give your children is a secure and promising future. It’s never too early to start investing in their future, so here are three ways to set your child up for financial success: Life Insurance Life insurance might not be the first thing that comes to mind when thinking about setting your child up for success, but it can provide an essential safety net. Securing life insurance for your child while they are young and healthy can lock in lower premium rates. This coverage can continue into adulthood, ensuring they have access to affordable protection as they embark on their journey toward success. Life is unpredictable, and during unfortunate events, life insurance can help cover funeral expenses, medical bills, and more. Additionally, some life insurance policies have an investment component that can grow over time, providing a financial cushion for your child’s future. College Funds Investing in your child’s education is one of the most impactful ways to ensure their future success. The cost of education is a growing expense. Setting up a college fund can help you create a savings strategy to help your child during their college years. We offer a few options for college funds. For example, the 529 Plan is a tax-advantaged education savings plan in which you select options to invest in. These assets can then be used to pay for qualified education expenses at any eligible educational institution. Talk to your local OKFB agent about our financial services to get started. Estate Planning Estate planning is a comprehensive approach to ensure that your child’s future is secure, no matter what life throws their way. This option involves preparing for various scenarios, including unforeseen incapacitation or unfortunate events, like a parent’s passing. During the process, your advisor may suggest you work with an attorney to draft important documents that will make decision-making easier for your loved ones. For example, determining financial and medical powers of attorney, guardianship documents to designate caretakers for your minor children and a will to outline what you’d like to have happen to your assets after your death. Life is complicated and unpredictable, but taking steps now to set up your child for financial success can bring some peace of mind. Plan now for your child’s next phase in life by setting them up for success. We’re Here to Help Whether you’re a longtime policyholder or just starting to look for insurance options, we’re here to help. If you have questions or concerns that you want to discuss, connect with your local OKFB agent today. If you have any insurance-specific questions, we would love to help you find the coverage that best meets your home, auto, commercial and life insurance needs. Don’t forget to follow us on social! This kind of information and more is just a click away. You can find us on Facebook, Instagram and LinkedIn.
7 Life Insurance Terms You Need to Know June 1, 2023 You probably already know that life insurance is a way to protect your loved ones financially if something happens to you. But do you know all the terms that go along with it? Don’t worry, we’re here for you. Keep reading as we break down seven life insurance terms that you should know about while considering your options. Term life insurance Term life insurance provides coverage for a specific period of time, usually 10-30 years or the number of years until you reach age 65. If you pass away during the term, your beneficiary will receive the death benefit. This option is perfect if you’re just starting out, raising your family or building your business. Whole life insurance Whole Life provides coverage for–you guessed it–your whole life, as long as you pay the premiums. It also accumulates a cash value over time, which can be borrowed against or used to pay premiums. This type of policy is typically more expensive, but it offers more long-term financial protection. Universal life insurance Universal Life insurance is similar to Whole Life, but offers more flexibility. You can adjust elements of the policy, such as premium payments and death benefits, as needed. This type of policy is often used as an investment vehicle, as the cash value can grow over time. Universal Life is a good option if you want to have life insurance and save for retirement at the same time. Now that we’ve talked about the different types of life insurance, let’s dive into some more general terms. Beneficiary A beneficiary is the person (or people) who will receive the death benefit from your life insurance policy if you pass away. It’s important to designate a beneficiary so that your loved ones know who to contact and how to receive the funds. Lump sum When it comes to payout options, a lump sum is usually the default for most life insurance policies. This means that your beneficiary will receive the entire death benefit in one large payment. While this can be helpful for those who need the money immediately, it may not be the best option for everyone. Talk to your local OKFB agent to discuss payout options. Retained asset account A retained asset account is like a checking account for your beneficiary. Instead of receiving a lump sum payment, the insurance company holds onto the payout in an interest-accruing account. Your loved ones can then write checks from the account as needed. This option can be helpful if your beneficiary isn’t quite sure how to manage a large sum of money. Pre-death benefits Did you know that some life insurance policies allow you to access the death benefit while you’re still alive? Pre-death benefits, also known as accelerated death benefits, can help you pay for medical expenses or other costs associated with a terminal, chronic or critical illness. While it may not be the most lighthearted topic, understanding these terms can help you make informed decisions about your financial future. We’re Here to Help Whether you’re shopping for life insurance or want to update your policies, we have agents who can help. If you have questions or concerns that you want to discuss, connect with your local OKFB agent today. If you have any insurance-specific questions, we would love to help you find the coverage that best meets your home, auto, commercial and life insurance needs. Don’t forget to follow us on social! This kind of information and more is just a click away. You can find us on Facebook, Instagram and LinkedIn.
