The volatility in the stock market over the past few years has resulted in many investors seeing their retirement accounts shrink in value. While the stock prices may rise over time, many individuals are being forced to re-examine their retirement plans. For older individuals with less time until their planned retirement, a serious review of their financial future may be essential.

Basic Retirement Planning
The fundamentals of planning for a financially secure retirement are simple – have enough money accumulated at retirement so those savings and the earnings on those savings will enable you to afford the lifestyle you want until you die.

Unfortunately, market declines and reduced expectations for future market returns are playing havoc with many retirement plans. Within the current environment, here are some options to consider as you refine your retirement plan:

Save more while you are working.
Be sure to take full advantage of any company offered retirement plan. If you participate in a 401(k) plan, contribute as much as you can and at least enough to earn the entire match the company may offer.

Set up an automatic savings plan. Have a set amount deducted from each paycheck and deposited into an account you earmark for retirement.

Examine your monthly household spending to see if there are ways to spend a little less. Refinancing your mortgage, increasing your insurance deductibles and reducing spending on discretionary items can add up.

Earn more on your retirement assets before you retire.
Examine how your funds are invested and how your "cash" is employed. A well thought out asset allocation for your investments, one that incorporates your time horizon and risk tolerance, can provide diversification and some peace of mind. Generally, the younger you are, the more of your long-term investments should be in equities. Over time, high quality stocks have produced greater returns than bonds and cash investments.

Your cash should be working hard too. Take advantage of higher interest rates on accounts that provide less liquidity and on longer term CDs if you can leave the money in the accounts or CDs for longer periods.

Work longer until you retire.
Delaying your retirement enables you to have more for retirement in several ways:

  • While working, you can save more in your retirement plan and through regular savings.

  • Especially with your tax-deferred retirement accounts, leaving all your funds within the account enable them to grow faster. For example, if you delay retirement for five years and earn just 5% on the funds, you will have about 27% more just from the earnings.

  • Delaying when you start collecting Social Security will increase your monthly benefits. If you are currently 55 years old, you can start collecting full Social Security retirement benefits at age 66. If you start at age 62, you will only get 75% of that amount and if you wait and start collecting at age 70, you will get 132% of that amount.

Spend less during your retirement years.
Everyone wants a "full and active lifestyle" during retirement. Perhaps you should consider changing exactly what the "full and active lifestyle" means. Less travel, less expensive cars or foregoing a second home (or opting for a smaller one) will make a difference. Anticipating and setting sensible spending priorities will probably be part of many individuals’ retirement.

Leave less to your heirs.
What you do not spend during your lifetime will pass to your heirs. It may be unpleasant to consider, but spending time with your family discussing your finances can help them prepare as well.

Summary
The declining stock market has affected almost everyone. Take some time to evaluate your overall retirement plan. If you find ways to save more and invest the funds wisely, the retirement you seek may still be possible.

Hot Topics

What is FAIRWINDS' Routing Number?

263181368

What are the 2013 IRA and HSA contribution limits?

Find out here.

When will I receive my 2012 5498 form?

Find out here.

What is a Routing Number?

FAIRWINDS' routing number (263181368) is used to identify FAIRWINDS Credit Union from other financial institutions and in no way identifies you or your accounts to others.

A routing transit number (RTN) is a nine digit bank code, used in the United States, to facilitate the sorting, bundling, and shipment of paper checks back to the drawer's (check writer's) account.

The RTN is also used by Federal Reserve Banks to process Fedwire funds transfers, and by the Automated Clearing House (ACH) to process direct deposits, bill payments, and other such automated transfers.

What can I do with my Relationship Rewards points?

Relationship Rewards provide you the opportunity to enjoy special member benefits including:

  • Buying down the interest rate on a loan.
  • Increasing your rate on a new CD.
  • Reducing service charges on additional products and services.
Learn more about our Relationship Rewards program.

How do I send or receive a wire?

To send a wire from FAIRWINDS, please provide the following:

  • Name, address and routing number of financial institution receiving the wire
  • Account number for the receiving account
  • Name and address of receiving account holder

There is a $20.00 service charge for an outgoing domestic wire from a personal account and a $25.00 service charge for an outgoing wire from a business account.

To receive a wire at the credit union, you will need to provide the following:

  • FAIRWINDS routing number (263-181-368)
  • Name of account holder
  • FAIRWINDS account number to receive the funds

There is a $10.00 service charge for an incoming domestic wire to a personal account and $15.00 service charge for an incoming wire to a business account.

*Please verify this information with the receiving financial institution as there may be an intermediary financial instititution involved.

When should I expect my 5498-ESA tax forms?

5498-ESA tax forms will be mailed by April 30th for all Coverdell Educational Savings Account owners who made contributions and/or rollovers into their ESA's in 2011.

5498 and 5498-SA tax forms will be mailed in mid-May for all Traditional, SEP, and Roth IRA owners and Health Savings Account owners who made contributions and/or rollovers into their IRA's and HSA's in 2011.

For questions regarding the 5498 forms please call Member Services at 407-277-5045 or visit your local branch.

When should I expect my tax forms?

FAIRWINDS mails 1099-INT and 1098 tax forms at the end of January. However, if you have e-Statements, these tax forms are available online right now!
Learn more here.

Members will only receive a 1099-INT form if the aggregate earnings amongst the accounts they are tax reported for (the primary owner) have earned at least $10 in interest.

These accounts include:
Savings, checking, money market, certificates of deposit, and US Bonds Redeemed, but do not include IRA accounts. If members have not earned at least $10 in interest, they will not receive a 1099-INT form.

Members will only receive a 1098 Mortgage Interest Statement if they paid $600 or more in interest on their mortgage.

FAIRWINDS mails 1099-R, 1099-Q, 1099-SA, and FMV/RMD statements to members by January 31st each year. We also mail 5498, 5498-SA, and 5498 ESA forms to members by the end of May.

Important information for all MasterCard® and VISA® credit and debit card holders.

You may have seen news stories recently about a potential data breach with MasterCard® and VISA® through a third-party payment processor. While there is no indication that any FAIRWINDS members have been impacted by this event, it is an opportunity to remind all consumers about the importance of being diligent, safeguarding your personal information and monitoring your accounts on a regular basis to minimize the effects of fraud.

Take the few extra steps to proactively protect your accounts. If you believe your credit or debit card information is at risk or unauthorized transactions have posted to your account, contact your financial institution immediately. In addition, you may want to consider looking into an identity theft alert program to keep you informed of activity on your accounts. There are many reputable programs available, including ID Secure. Click here to learn more.

There is an active texting scam occurring in the Central Florida area.

People are receiving a text at random stating their "card has been deactivated." This is a Scam!

Always remember, FAIRWINDS will never ask members to provide confidential information, such as debit or credit card numbers, PINs or Social Security numbers via email, text messages, direct mail or over the phone.

If you feel you are the victim of account fraud or identify theft, act immediately. This should help minimize the damage to your personal accounts and credit rating. Click here to learn more.

What are the 2013 IRA and HSA contribution limits?

Traditional and Roth IRA owners under age 50 may contribute up to $5,500 toward tax year 2013. A $1,000 catch up contribution may be added for Traditional and Roth IRA owners age 50 and over.

2013 SEP contribution limits have increased to a maximum of $51,000 or 25% of the employee's compensation, whichever is less.

HSA owners under age 55 with an individual HDHP (self coverage only) may contribute up to $3,250 toward tax year 2013. HSA owners under age 55 with a family HDHP may contribute up to $6,450 toward tax year 2013. A $1,000 catch up contribution may be added for HSA owners age 55 and over.

When will I receive my 2012 5498 form?

5498, 5498-SA, and 5498-ESA forms report IRA, HSA, and ESA contributions, rollovers, conversions, and fair market value (December 31st balance) information to the IRS and account owners. 5498 and 5498-SA forms are expected to be mailed by Saturday, May 18th.

Please contact Member Services at (407) 277-5045 or visit your local branch if you have questions about your form(s).

How can I make a prior year (2012) contribution to my IRA or HSA?

Eligible prior year (2012) IRA and HSA contributions may be made through the close of business on Monday, April 15th. The IRS requires signed documentation before contributions may be designated for a prior year.

Members can accomplish this by visiting a local branch during business hours or by submitting an e-Signed form through Retirement Central® and click Manage An Account on the left menu.