Older Workers - Options For Retirement Planing

For this discussion we will be taking about workers who are between 50 and 60 years of age who do not as of yet have any type of retirement plan. This isn't as far-fetched as that sounds.

In this day and age they are millions of people that have worked for a very long time that never gave a lot of thought for saving for retirement or didn't have the means to save properly.

Until 1974 there wasn't any IRA accounts available for the people and most retirement plans came from an employer. If you are over 50 your options are not as great as they were when you were younger and you have less time to save as well.

Here are a few ideas that might help.

First off if you are still working and plan on doing so for at least ten more years or so then go set up a Roth IRA account. A Traditional IRA will not do you very much good at this point because IRS laws state that you must start withdrawals at 59 ½ years of age which wouldn't give you much time to put money into it. While with the Roth IRA you can put money into long after 59 ½ and withdraw it out at any age past 59 ½.

You will pay taxes on the money now and pay no taxes when you begin to withdraw the fund. This is a start and although you won't have the time to save as much if you would have started earlier it is better than nothing.

Now think about your house. If you have it paid off or a very small mortgage you might want to consider selling your home for a profit, and then get something a bit more reasonable for your retirement years and re-invest the profit from your home sale.

At this point you will probably look for some medium to small range type of investments to maximize the amount of earnings you might be able to acquire depending on how long you plan on working.

Supposing that you made a nice profit from your home sale take a look at acquiring some mutual funds and some CDs along with your Roth IRA. This way you do not have all your eggs in one basket. Good example is just look at what happen to the stock market the past few years and for those who had all their eggs in it took quite a big bath. For those who were more diversified the damage wasn't as severe.

At this point certain Mutual Funds are still doing quite well and should do all right in the next ten or more years. CDs rates are still low but are subject to change so buy a few short range CDs, 3 to 6 month range and keep rolling them over and much as you can at the best rates you can find.

So basically since you started late if you have at least ten more years to work you could save up to $60,000 in your Roth IRA and also make several thousand dollars on your Mutual Funds and CDs.

One thing to also think about beside the Roth, is to buy a very cheap fixer-upper of a house, fix it up, wait until the house market rebounds and then sell that to make a decent profit to help out when you no longer are able to work.

At this point when you retire you can then draw on your social security, your Roth, interest off your mutual funds and CDs and hopefully have enough to enjoy your retirement years.

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