October is National Retirement Security Month, providing a great opportunity as the year winds down to take a look at one’s finances, goals, and plans for retirement.
With recent research showing that many of us greatly underestimate how long we’ll live, it’s important to plan ahead and make sure you’re on track to reach your retirement goals.
If you’re a member of the PERA Defined Benefit Plan, you’re already set for lifetime income in retirement. But if you’d like to do more to ensure your retirement security, there are steps you can take.
Consider some of the items below if you’re taking stock of your financial health this month:
- Save additional money in a PERAPlus plan: PERA offers a voluntary PERAPlus 401(k) Plan to all members, and some PERA employers also offer the PERAPlus 457 Plan. Both plans allow you set aside additional pre-tax dollars (there’s also a Roth option) on top of what you contribute to your PERA Defined Benefit Plan or PERA Defined Contribution Plan account.
- Make a savings plan: A recent survey found that a surprising number of Americans have no savings account at all. Saving money is easier said than done, but making a plan to save even a little bit at a time can make a huge difference (not to mention you can take advantage of historically high rates on savings accounts right now).
- Take full advantage of your HSA, if you have one: If you have a high-deductible health plan with a health savings account (HSA), you might not be aware of its retirement-planning benefits. In addition to setting aside pre-tax dollars for health care expenses (one of the biggest expenses in retirement), your HSA balance is available to spend on other needs once you reach age 65. Your HSA is also exempt from required minimum distributions (RMDs).
- Don’t forget estate planning: Estate planning isn’t just for the wealthy, and it’s not just for deciding who inherits your assets. Good estate planning can also make sure your loved ones know what to do if you’re no longer able to care for yourself.
- Download the new PERA mobile app: The PERA app allows members to access important information like account balance, projected monthly benefit, and service credit history, as well as fill out forms (and even apply for retirement) from their mobile phone.
Regardless of where our members are in their public service career, we have a lot of helpful resources on PERA benefits available online, including:
- Frequently asked questions (FAQs)
- Quick Tip videos
- On-demand and live webinars
- Financial wellness articles
Defined benefitAlso known as a pension, this is a type of pooled retirement plan in which the plan promises to pay a lifetime benefit to the employee at retirement. The plan manages investments on behalf of members, and the retirement benefit is based on factors such as age at retirement, years of employment and salary history.Defined contributionA type of individual retirement plan in which an employee saves a portion of each paycheck (along with a potential employer match) and invests that money. The employee’s retirement benefit is based on their account balance at retirement. A 401(k) is a type of defined contribution plan.