Retirement Financial Planning

Have you ever received a hefty chunk of change and immediately spent it all as if your pockets were made with swiss cheese lining, only to later see something you really need and wish you still had the money left to purchase it? It’s a pretty common problem. Money management is a noble ideal but a troublesome practice for many otherwise responsible working adults. A 401k plan helps to encourage a wage earning individual to set aside some his or her annual earnings for either retirement or a rainy day in the future, prolonging financial gratification for a later date at which you’ll be even more appreciative. A 401k plan is essentially a means of income deferral, opting to receive payment decades after it was actually learned, forcing the recipient to budget responsibly. In a traditional 401k plan, a percentage of wages are paid directly to the 401k account which is managed by the employer. (more…)