June 5, 2010
what are the advantages and disadvantages of opening a retirement plan?
asked:
I am planning to open a retirement plan but what are the advantages and disadvantages of opening a retirement plan and what is the best company to open an account with?
Nick
I am planning to open a retirement plan but what are the advantages and disadvantages of opening a retirement plan and what is the best company to open an account with?
Nick
Comments on what are the advantages and disadvantages of opening a retirement plan?
Ashley
Retirement plans may be classified as defined benefit or defined contribution according to how the benefits are determined. A defined benefit plan guarantees a certain payout at retirement, according to a fixed formula which usually depends on the member’s salary and the number of years’ membership in the plan. A defined contribution plan will provide a payout at retirement that is dependent upon the amount of money contributed and the performance of the investment vehicles utilized.
Leslie
Shop around for the best deal. The advantage is having a decent lifestyle when you retire, cos you cant rely on this government to provide a decent pension it will be a pittance. Depends what you want in later life, but you should get a pension.
Marcelo
advantage - being able to live and eat in retirement - social security doesn’t pay enough to live on if it will even be there when you retire
disadv - non
Cheyenne
Advantages-saving money that will help you later in life. A solid savings account is like a good safety net. I was able to save a good chunk of money in a Roth IRA and it really helps with my peace of mind. Also, the Roth IRA is not taxed by the govt, so you’ll be saving even more money through it. Also, look at this website to see how money grows over a lifetime:
Disadvantages-you can’t blow all your cash on stuff now.
If you are earning less than $90,000 (I think), you can open up a Roth IRA at Fidelity. You can invest in various types of investment vehicles, so do your research. I would also suggest reading finance yahoo or some other finance site to get a feel of what is going on around you.
Another rule of thumb: don’t buy within 20% of a stocks high.
Marvin
Advantages and disadvantages, of having a Retirement Plan, are almost same what is their in savings. As a matter of fact, Retirement Plans is saving. Money you put in as saving, now comes back to you, after your retirement regularly, every month for meeting your expenses.
Shop well, to have most suitable Plan.
All the Best.