Home     About Us    Contact Us     Contribute     Privacy
Investing
Stocks
Bonds
Mutual Funds
Biz
Credit
Career
College
Economics
Tax
More
 
 
Marketplace
Related Articles
Related Definitions
Related Categories
Tip of the Day

Tip of the Day Avoid Fees

Avoid Fees - When using long-term investments as a money-earning vehicle, it is wise to remember that any returns that are made on that money must deduct any fees paid...

read entire tip

Related Podcasts
Recently Added
Other Great Sites
 

IRAs and Young Investors Instead of Social Security

Posted On: 2006-10-02Length: 12:00

Listen to this podcast

Doubts about the future of social security? They continue to haunt some investors, but there are others who aren't waiting to find out whether social security will still be around when they're ready to retire. They're taking proactive steps now. More in this Fidelity Personal Finance podcast.

According to a survey commissioned by Fidelity Investments, today's 20 and 30 somethings are doubtful that social security will be around to help them pay for their retirement. And rather than doing nothing about it, 47% of investors aged 35 or younger cited concerns about social security as their motive for opening an IRA. Sounds like the message is hitting home that Americans today need to shoulder more of the burden of financing their own retirement. And that saving more today is the one thing we can do as investors to improve our chances of living the life we want in retirement. The concerns about social security's future are well founded. The 2005 annual report from the social security board of trustees projects that the annual cost of social security benefits will rise from 4.3% of gross domestic product, or GDP, to day, to 6.4% of GDP in 2079. This report can be found on the social security administration's website, at www.ssa.gov. And tax income for the combined old age and survivor's insurance and disability insurance, or OASDI trust funds, will begin to fall short of outlays starting in 2017. By 2041, when today's 30-year-olds will start turning age 65, the board of trustees predicts that the OASDI trust funds will be exhausted. Congress may eventually raise payroll taxes, or reduce social security benefits to close the deficit. But the writing is on the wall for anyone willing to read the signs. The days when you could count on benefits from your employer and the government to pay for a comfortable retirement are numbered. Potential cutbacks in social security benefits are not the only obstacles for young investors. Traditional corporate pension benefits and retiree health insurance coverage are becoming increasingly rare. Investors also appear concerned about the long-term affects of inflation. Forty-three percent of those surveyed, 31% being age 35 and younger, cited inflation as a factor that prompted them to open an IRA. And the recent surge in gasoline and energy prices is certainly not helping to calm concerns about inflation. So why does an IRA make sense? An IRA can help you supplement any retirement savings you accrue through a workplace savings plan, such as a 401K or 403B. If your employer does not offer a plan, or if you are self-employed, an IRA offers tax advantages that you simply can not find in taxable investment accounts. You can make deductible contributions to a traditional IRA if certain requirements are met. Any earnings within an IRA grow tax deferred while they remain in the account. Pre-tax contributions and any earnings in traditional IRAs...

Discuss It!

Kami menggunakan Jasa SEO Indonesia profesional.

said:

Good to know such idea, thank you.

best internet providers said:

There are lots of youngsters getting interested in the field of investment especially in the stock markets. It has resulted in a lot of competition in the field and it is important for them to have a good idea of the same. These details will be useful for that.

Most Popular Articles
Most Popular Definitions
 
Daily Definition

Definition of the Day Quick Ratio

Definition: A ratio that measures a company's ability to meet its current liabilities with its liquid assets. TeenAnalyst Advice: It's important that a company be able to pay their debts and other ...

read entire definition

 
 

 

 

Home     About Us    Contact Us     Contribute     Sitemap

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Copyright © 2009 TeenAnalyst.com