Saving
More Money, Now & Later
You
could save today & tomorrow, often without that penny-pinching feeling.
Directly & indirectly, you might be
able to save more per month than you think. Hidden paths to greater savings can be found at home and at work, and
their potential might surprise you.
Little everyday things may be costing
you dollars you could keep. Simply
paying cash instead of using a credit card could save you four figures
annually. An average U.S. household carries $9,000 in revolving debt; as credit
cards currently have a 13% average annual interest rate, that average household
pays more than $1,000 in finance charges a year.1
The typical bank customer makes four $60 withdrawals from ATMs a month
– given that two or three are probably away from the host bank, that means
$5-12 a month lost to ATM fees, or about $60-100 a year. A common household
gets about 15 hard-copy bills a month and spends roughly $80 a year on stamps
to mail them – why not pay bills online? Automating payments also rescues you
from late fees.1
A household that runs full loads in washing machines and dishwashers,
washes cars primarily with water from a bucket, and turns off the tap while
shaving or brushing teeth may save $100 (or more) in annual water costs.1
Then, there are the big things you could
do. If you are saving and investing
for the future in a regular, taxable brokerage account, that account has a
drawback: you must pay taxes on your investment income in the year it is
received. So, you are really losing X% of your return to the tax man (the
percentage will reflect your income tax rate).2
In traditional IRAs and many workplace retirement plans, you save for
retirement using pre-tax dollars. None of the dollars you invest in those plans
count in your taxable income, and the invested assets can grow and compound in
the account without being taxed. This year and in years to follow, this means
significant tax savings for you. The earnings of these accounts are only taxed
when withdrawn.2,3
How would you like to save hundreds of
dollars per month in retirement? By
saving and investing for retirement using a Roth IRA, that is essentially the
potential you give yourself. Roth IRAs are the inverse of traditional IRAs: the
dollars you direct into them are not tax deductible, but the withdrawals are
tax free in retirement (assuming you abide by I.R.S. rules). Imagine being able to receive
retirement income for 20 or 30 years without paying a penny of federal income taxes
on it in the years you receive it. Now imagine how sizable that income stream
might be after decades of compounding and equity investment for that IRA.4
Many of us can find more money to save,
today & tomorrow. Sometimes the
saving possibilities are right in front of us. Other times, they may come to us
in the future because of present-day financial decisions. We can potentially
realize some savings by changes in our financial behavior or our choice of
investing vehicles, without resorting to austerity.
We may be reached at 800-916-9860.
www.wenadvisory.com
This material does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
Citations.
1 - tinyurl.com/ydedsyl5 [4/24/17]
