Five Tips to Transition into the 'New Normal' with Your Retirement Intact
Winston Churchill once said, “Never let a good crisis go to waste.”
Well, here we are in a crisis and it would be a shame if you didn’t take this opportunity to review what must be done to transition into the “new normal” with your retirement intact.
According to Rob Williams, vice president of financial planning at Charles Schwab, there are at least five tips and tricks to follow:
- Reassess your financial plan: Revisit your short- and long-term goals, review your risk tolerance, your risk capacity, and re-evaluate your ability to achieve your financial and retirement goals.
- Evaluate your everyday cash: If you’re in or nearing retirement, make sure you have enough cash to cover at least one year of expenses.
- Avoid early retirement withdrawals: While the CARES Act loosens restrictions to benefit those in need, investors should still avoid early access or loans from retirement accounts. If you must take a withdrawal, remember that the CARES Act allows qualified individuals to take up to $100,000 of penalty-free coronavirus-related IRA and company plan distributions during 2020. The coronavirus-related distributions (CRDs) can be repaid within three years to a retirement account tax-free.
- Understand changes outlined in the SECURE Act: The SECURE Act revised retirement required minimum distributions (RMDs), traditional IRA contributions, rules for inherited retirement accounts and more.
- Review legacy planning: COVID-19 puts everyone at risk. It’s time to take inventory of your assets and debts and put your wishes in writing.
