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How to Calculate Your Financial Independence Ratio

How to Calculate Your Financial Independence Ratio 1

How close are you to financial independence? What if I tell you that you can calculate this number down to a reasonably precise percentage. Regardless of where you stand financially, knowing where you are is a great way to help you move closer toward your goal of financial independence. Like measuring distance or time, knowing … Read more How to Calculate Your Financial Independence Ratio

9 Factors to Consider When Planning for Retirement

Planning for Retirement

When planning for retirement there’s an overwhelming tendency to focus on the financial side, and as well as should be. Without a solid tax-deferred retirement plan, there would be no retirement for most people. But there’s also a non-financial side of retirement that we need to be concerned with too. If we concern ourselves strictly … Read more 9 Factors to Consider When Planning for Retirement

Best Retirement Plans: Differences and Overview

Understanding your retirement accounts

In the United States, it is quite common for individuals to leave it up to their employers to kick start the retirement planning efforts of the individual by enrolling them in a 401(k) or other employer-sponsored retirement plans. However, there are many plans beyond your standard 401(k) plan that could potentially do a better job … Read more Best Retirement Plans: Differences and Overview

401(k) Contribution Limits for 2019 and 2020

401(k) Contribution Limits for 2019 and 2020 24

According to the IRS, the combined total contribution you can make to all of your 401(k) plans (including traditional 401(k), Roth 401(k), and individual 401(k) plans) in 2020 increases by $500 to $19,500. The catch-up contribution limit also increases from $6,000 to $6,500. However, you may be limited by what your employer allows you to … Read more 401(k) Contribution Limits for 2019 and 2020

Introduction to Health Savings Account (HSA)

A health savings account (HSA) is a tax-advantaged savings account that you can use for medical expenses. You can take advantage of an HSA when you choose a qualifying health insurance plan; typically a high deductible health plan (HDHP). Recently, our employer switched to an HDHP that offers lower monthly premiums in exchange for a … Read more Introduction to Health Savings Account (HSA)

The 4% Safe Withdrawal Rate Retirement Drawdown Rule

The 4% Safe Withdrawal Rate Retirement Drawdown Rule 31

The 4% Safe Withdrawal Rate (SWR) was first introduced by William Bengen in 1994 and later supported by the Trinity Study in 1998. The rule basically states that when you hit retirement age, you can withdraw 4% of your total retirement savings initially. Each year, you increase the amount by the inflation rate. Assuming you … Read more The 4% Safe Withdrawal Rate Retirement Drawdown Rule