Developing a Retirement Planning Strategy
Provided by: Michael Alioto, Senior Vice President, UBS Financial Services Inc.
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Tanning for retirement means far more than simply accumulating a nest
egg for the years when you're no longer working. It involves developing a
long-term investment strategy that helps you address this critical goal with-
out losing sight of your more immediate financial concerns, such as paying your
mortgage or sending a child to college.
Where Will Your Retirement Nest Egg Come From?
You will potentially need 70% to 80% (or even more) of your pre-retirement
income to maintain your standard of living in your retirement years. Therefore,
before you can formulate a cohesive retirement plan, you need to determine what
your sources of income will be in retirement.
• Individual Retirement Accounts ("IRAs"). If you don't have an IRA, you could
be passing up a valuable opportunity to save fjr your retirement. Whether
you choose a traditional IRA or a Roth IRA, the same basic tax-favored
principle applies: savings in an IRA get the benefit of tax-deferred growth.
As a result, an investment in an IRA allows you to potentially accumulate
more assets than if you had invested the same dollars in a taxable account. 2
• Your Company Retirement Plan. Past generations relied on company pension
plans to take care of their retirement needs. While many companies still
maintain defined benefit plans, many have switched to or added defined con-
tribution plans, such as 401(k) plans. With a 401(k) plan, the responsibility
is on you to contribute to the plan and determine how your savings will be
invested.
One key advantage of 401(k) plans is that they offer tax-deferred savings.
That means that you do not pay taxes on your contributions or on the earnings
accumulating in the plan until you make a withdrawal. Consider making the
highest allowable contribution to your employer-sponsored retirement plan.
If you are eligible to participate, you may generally contribute up to
$16,500 this year, and $22,000 if you are age 50 or above depending upon
the provisions of the plan and other limitations imposed by law. For exam-
ple, 401(k) plans must meet non-discrimination tests, which can limit the
amount that highly compensated employees may elect to defer from salary
and receive as matching contributions based on the amounts that non-highly
compensated employees can defer and receive.
• Your Social Security Benefits. These days, Social Security represents only a
small portion of the income most retirees will need. According to a study
done by the Employee Benefit Research Institute, individuals 65-years-old or
older whose post-retirerlent annual income was at least $50,000 would gen-
erally derive only 14.3% of their retirement income from Social Security.
The Responsibility to Plan Is Yours
The majority of the income you'll need in retirement will most likely come from
you. That's why it's vital that you take the time now to develop an intelligent,
practical retirement plan that can help you pursue your retirement income needs.
A good way to start is to participate to the fullest extent possible in a 401(k)
plan (if your company provides one) and make annual contributions to an IRA.
Both give your money the potential to grow on a tax-deferred basis.
Professional Advice
There are many tools available to help you quantify your goals and implement
your plans. By working with a professional financial advisor, he or she can help
you develop a retirement plan that suits your particular goals and circumstances.
Through education, patience and a disciplined approach to saving, you can pursue
your long-term financial goals.
1. Certain eligibility requirements apply with respect to making contributions to traditional and Roth IRAs; you should consult your tax advisor.
2. All or a portion of the amount withdrawn from an IRA may be subject to ordinary income taxes. In addition, withdrawals may be subject to an additional 10% tax penalty for early distribution.
Neither UBS Financial Services Inc. nor its Financial Advisors provide tax or legal advice. You should consult an attorney or tax professional regarding your specific situation.
3. Employee Benefit Research Institute tabulations of data from the March 2008 Current Population Survey.
Neither UBS Financial Services Inc. nor its Financial Advisors provide tax or legal advice. You should consult an attomey or tax professional regarding your specific situation.
The information in this article is based on sources believed to be reliable, but its accuracy cannot be guaranteed.
Do you need h
aging
vestme
If you are like many investors, you may be overreacting to daily market
ups and downs—buying or selling without a clear investment strategy. In
today's complex marketplace, this could be costing you money or exposing
you to undue risk.
That's why we offer individuals and institutions a variety of advisory
programs in which experienced professionals take on the complicated task
of day-to-day portfolio management, while you maintain control of your
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You'll benefit from:
• Personalized investment strategy
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• Ongoing consultation and evaluation
For a complimentary consultation, contact
The Alioto Group
Michael Alioto
Kelly Petrocella
Senior Vice President-Investments
Financial Advisor
Wealth Advisor
248-645-3933
248-645-3900
kelly.petrocella@ubs.com
michael.alioto@ubs.com
Brandon Love, CFP®
Account Vice President
Advisory & Brokerage Services
248-645-3926
brandon.love@ubs.com
William Bottrell, CRPS®
Financial Advisor
Advisory & Brokerage Services
248-645-3934
william.bottrell@ubs.com
325 North Old Woodward Avenue, Birmingham, MI 48009
www.ubs.com/financialservicesinc
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objectives, risk tolerance and liquidity needs to determine suitability prior to an investment with any manager or investment program. Separately
managed accounts programs offered by UBS Financial Services Inc. are subject to minimum amount requirements. Minimum account size is
generally $100,000. Higher minimums apply to certain strategies and Multiple Style Accounts.
*UBS
Wealth
Management
UBS Financial Services Inc. is a subsidiary of UBS AG. 02010 UBS Financial Services Inc. All rights reserved. Wealth management services in the U.S. are provided by UBS Financial Services Inc., a registered broker-dealer offering securities, trading,
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of the College for Financial Planning'.8.19_m_9.n.6.333 Jrzol2.2_pee(
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