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Common Questions about Retirement Saving, College Savings, and Credit Problems for Seniors

What should I do with my retirement?

When it comes to retirement savings, many people are not as prepared as they should be. This is especially true for younger people who have decades of work ahead of them before they can even consider retiring. One mistake is to start a retirement account with an employer and leave it behind when you leave the company. No, this doesn’t mean you lose the money, it just means that you are not building on it. Your money will grow fast when you keep it all together so take the money with you by rolling it over into your retirement at your new employer and placing it into an IRA. Another mistake is to cash out your retirement when you leave an employer. This can cost you a lot since the U.S. government not only takes taxes out of this money but could also charge you a 10 percent penalty. Don’t jeopardize your future by robbing your retirement account. Keep control of your money by keeping it together and not withdrawing the funds.

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Why should I save for retirement?

Many people go to work each day with the assumption that one day they will be able to retire. This can only be possible if you are putting money away now for your retirement. Start by putting a percentage away each month through an employer retirement plan or IRA. If you start early enough, your nest egg can be quite significant after 30 or 40 years. Failing to save enough could either make it difficult for you to retire or leave you reliant on social security. Since there is doubt as to the future of social security, don’t count on this as your means to retirement.

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Why do I need to worry about saving for college?

If you have young children, you may need to start putting money away for their college fund. The cost of attending college is expected to continue to rise each year so saving early can help you ensure that you have funds to help with future college expenses. Many states offer special savings plans like the section 529. There may even be a tax advantage to putting money into a college savings plan. A tax advisor can give you more information on these benefits.

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What should a senior do about credit problems?

Even senior citizens can fall into a trap with credit cards building up more debt than they can afford on a limited income. If this has happened to you, debt consolidation is still an option. You can find debt management professionals to help you get control of your debt; however, be sure to check into the company first.

The AARP may have recommendations on professionals you can use or you can check with the Better Business Bureau. As a senior citizen be cautious of offers that come your way especially ones that involve using the equity in your home. While there are plenty of reputable companies out there that can help you with your debt consolidation, there are also a number of unscrupulous ones that just want your money. By working with a credible professional to complete your debt consolidation you can be sure that they aren’t looking to take your house out from under you.

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