{"id":34860,"date":"2021-12-13T20:27:27","date_gmt":"2021-12-14T01:27:27","guid":{"rendered":"https:\/\/www.glensfalls.com\/glensfallsbusinessjournal\/?p=34860"},"modified":"2021-12-13T20:27:27","modified_gmt":"2021-12-14T01:27:27","slug":"people-who-save-for-retirement-at-an-early-age-will-benefit-greatly-in-the-long-term","status":"publish","type":"post","link":"https:\/\/www.glensfalls.com\/glensfallsbusinessjournal\/2021\/12\/people-who-save-for-retirement-at-an-early-age-will-benefit-greatly-in-the-long-term\/","title":{"rendered":"People Who Save For Retirement At An Early Age Will Benefit Greatly In The Long Term"},"content":{"rendered":"
\"\"
Mark Wells is the co-founder of Three Buckets Wealth Management.
Courtesy Three Buckets Wealth Management<\/figcaption><\/figure>\n

By Christine Graf<\/p>\n

According to the Federal Reserve, only 36 percent of Americans are adequately saving for retirement.\u00a0 <\/span>The National Institute on Retirement Security estimates that almost 40 million U.S. households have no retirement savings.<\/p>\n

Certified Financial Planner Mark Wells, co-founder of Three Buckets Wealth Management, recommends that everyone have three to five months of living expenses in their savings accounts. A private wealth advisory practice of Ameriprise Financial Services, Three Buckets has offices in Glens Falls, Latham, and Tucson, Arizona.<\/p>\n

\u201cIf you don\u2019t have disability insurance through your employer, it should be closer to six months of living expenses,\u201d said Wells.<\/p>\n

He recommends making maximum contributions to employer matched 401K programs in order to take advantage of \u201cfree money.\u201d He also recommends Roth IRA\u2019s to many of his clients including recent college graduates who are in lower tax brackets than they will be later in their careers.<\/p>\n

\u201cWhat we have been doing with a lot of our clients is a Roth conversion which is essentially realizing the tax or converting pre-tax assets like a 401K or IRA to a Roth IRA so that you realize the tax in that year. But that amount going forward is tax free, and the earnings are also tax free. It\u2019s tax free to the owner of the account but also tax free to the beneficiary when they receive it down the road. In your early years when income is lower than it will be in the future, making a Roth contribution is a wise idea.\u201d<\/p>\n

<\/span><\/span>Many of Three Buckets\u2019 clients are members of the Baby Boomer generation and plan to leave inheritances to their children.<\/p>\n

\u201cThe Baby Boomer generation is getting older and older, and it is the first generation that is expected to leave behind more money than the prior generation. A lot of money will be changing hands,\u201d he said. \u201cThere\u2019s a lot of financial planning that goes into making sure we are making a client\u2019s situation as tax efficient as possible and also for the next generation\u2019s because we want to make sure that Uncle Sam isn\u2019t your biggest beneficiary when it\u2019s all said and done.\u201d<\/p>\n

When developing investment strategies, the firm focuses on what Wells refers to as the \u201cthree buckets.\u201d The first bucket, the pre-tax bucket, contains IRAs, 401Ks, and other investments that will be taxed upon withdrawal. The second bucket, the after-tax bucket, contains fully liquid assets for which earnings are taxed. The third bucket, the tax-free bucket, contains Roth IRAs and other investments for which distributions are tax free.<\/p>\n

\u201cStart saving for retirement sooner than later. The sooner you get started, the more money you will have at retirement, and you may be able to retire sooner than expected or have the quality of life you always hoped to have,\u201d he said. \u201cThe best advice I can give to a college graduate is that the first thing they need to do is put away as much as they can into a pension plan, and because they are likely in a low tax bracket, fund a Roth IRA.\u201d<\/p>\n

Roth IRA contributions are taxable, but earnings and withdrawals are tax free. Individuals who are covered by an employer\u2019s retirement plan can make contributions to a Roth IRA as long as they do not exceed IRS income limits.<\/p>\n

Those who haven\u2019t adequately saved for retirement often find themselves having to work for much longer than they had planned. This is a major concern for those who begin to experience health issues as they get older.<\/p>\n

Wells recommend finding a financial advisor who best meets a client\u2019s individual needs.<\/p>\n

\u201cIf you\u2019re hesitant, come in and have a conversation,\u201d said Wells. \u201cAt the very least, you are going to learn something. And the end of the year is a good time to take a look at your portfolio and rebalance it and make sure that you are still aligned with your risk tolerance and your goals.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

By Christine Graf According to the Federal Reserve, only 36 percent of Americans are adequately saving for retirement.\u00a0 The National Institute on Retirement Security estimates that almost 40 million U.S. households have no retirement savings. Certified Financial Planner Mark Wells, co-founder of Three Buckets Wealth Management, recommends that everyone have three to five months of […]<\/p>\n","protected":false},"author":89,"featured_media":34861,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[47],"tags":[],"yoast_head":"\r\nPeople Who Save For Retirement At An Early Age Will Benefit Greatly In The Long Term - Glens Falls Business Journal<\/title>\r\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\r\n<link rel=\"canonical\" href=\"https:\/\/www.glensfalls.com\/glensfallsbusinessjournal\/2021\/12\/people-who-save-for-retirement-at-an-early-age-will-benefit-greatly-in-the-long-term\/\" \/>\r\n<meta property=\"og:locale\" content=\"en_US\" \/>\r\n<meta property=\"og:type\" content=\"article\" \/>\r\n<meta property=\"og:title\" content=\"People Who Save For Retirement At An Early Age Will Benefit Greatly In The Long Term - Glens Falls Business Journal\" \/>\r\n<meta property=\"og:description\" content=\"By Christine Graf According to the Federal Reserve, only 36 percent of Americans are adequately saving for retirement.\u00a0 The National Institute on Retirement Security estimates that almost 40 million U.S. households have no retirement savings. 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