5 Costly Mistakes of the Newly-Retired

Reaching retirement is only half the battle. Once you successfully retire, it is up to you to make sure your money lasts. Too many retirees make costly mistakes that can quickly deplete their savings and force them back into the working world.

If you want to stay retired, you need to avoid making these five mistakes.

Changing your lifestyle too quickly.

What’s on your retirement to-do list? Do you want to relocate? Purchase an RV? Travel the world? Unless you have specifically budgeted for these adventures, we’d advise you to stop and catch your breath. Waiting one year before making any major changes will give you time to adjust to your new life and avoid making a critical mistake.

Starting Social Security too early.

While you are eligible to start Social Security as early as age 62, that doesn’t mean it’s a good idea. The longer you wait to claim these benefits, the larger your paychecks will be. For example, waiting until age 66 will boost your monthly income by 25%. Waiting until age 70 adds another 32%.

Being too conservative with investments.

It’s commonly advised to shift to a more conservative investment approach as you near retirement. While this is generally good advice, it is important not to become too conservative; you still want to make your money work for you. With most bonds and CDs yielding 1% or less, retirees should keep a small portion of their money in the stock market.

Not planning for withdrawal taxes.

Every type of retirement account is different, especially when it comes to taxes. If you don’t account for this, you could end up losing more money than you need to, or worse, running out of money entirely. Your financial advisor can help you determine a withdrawal strategy that is best for you.

Failing to prepare an estate plan.

Many retirees have done a great job preparing for their own financial needs, but give little-to-no thought about what happens to their money after they pass away. Without a proper estate plan, you may not be able to transfer your wealth to your spouse or children. Click here to learn more about estate planning.

American Investment Planners, LLC offers professional financial advice to individuals across the country. Whether you need help planning to retire, staying retired, or crafting an estate plan, our consultants are here to help.

To schedule a face-to-face appointment with one of our advisors, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

How is My Credit Score Calculated?

When it comes to getting approved for a loan, nothing is more important than your credit score; a number which indicates how likely you are to pay back your debts. A good credit score will generate more loan opportunities (at better interest rates) than a poor credit score will.

How is your credit score calculated?

The most common credit score, FICO, is calculated by the Fair Isaac Corporation. It can range from 300 to 850, with higher numbers indicating a better score. Generally, anything over 740 is considered “excellent”.

Your credit score is calculated based on five major components of your credit history, each weighted with varying importance:

Payment History – 35%

Your payment history is the most important factor of your credit score. Paying all of your bills on time, and in full, is the best way to keep this number high.

Amount Owed – 30%

Also known as your utilization ratio, this number looks at how much of your total available credit you are actually using. For best results, never borrow more than 30% of your maximum credit limit.

Length of Credit History – 15%

Determined by the average age of your credit accounts, as well as the amount of time since the account’s most recent transaction.

New Credit – 10%

Opening several new credit accounts in a short period of time signifies financial trouble, and could scare away potential lenders.

Credit Mix – 10%

This considers the different types of credit in your account: such as credit cards, student loans, car payments, mortgages, etc. Research shows that borrowers with a good mix of credit are more trustworthy to lenders.

Have questions about improving your credit score? The financial advisors at American Investment Planners, LLC are happy to assist. To schedule an appointment with one of our professional consultants, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

How to Save Money on Your Next Home Improvement

Does the new year have you dreaming of home improvement? Before you jump into your next project, read through these money-saving tips from American Investment Planners, LLC. They’ll help you achieve the look you want without breaking the bank:

Focus on upgrading efficiency, not space.

Considering knocking down a few walls to expand your space? Maybe you should reconsider, as these are among the mostly costly types of renovations. Instead of adding more space, focus on maximizing the space you already have. Some space-saving cabinetry for your kitchen is less than half the cost of an expansion and delivers the same results.

Consider Resale Value

Even if you aren’t planning on selling your home anytime soon, you should always consider how a renovation will impact resale value. Remodeling Magazine’s Cost vs. Value Report will help you determine which projects are worth taking on, so you can recoup costs in the event you do sell your home.

Be Cost-Conscious

Know when to splurge and when to save. Here are a few tricks to help minimize your cost of materials:

• Broaden your horizons. Take a look at outlets such as Lumber Liquidators instead of traditional big box hardware stores.
• Shop the sales. Even the aforementioned big box stores have clearance sales; use them to your advantage. The best time to look is during the fall and spring, when retailers are making room for their new inventories.
• Opt for stock sizes. Stock-sized cabinetry can be up to 80% cheaper than their custom-made counterparts.
• Imitation is the sincerest form of flattery. Similar to stock sizes, imitations can save you an immense amount on your remodel without sacrificing much quality.

Know when to DIY.

Don’t be afraid to roll up your sleeves and get a little dirty. Labor costs can account for up to 30% of your renovation – trim these expenses by taking on tasks that you can do yourself. However, it is important to know your limits, and avoid biting off more than you can chew. Which brings us to our last point...

Don’t skimp on contractor costs.

There are many places you can cut costs on your home improvement project, but the contractor isn’t one of them. Your project will only turn out as good as the contractor who installs it. For this reason, we highly recommend seeking out an experienced contractor – getting the job done right the first time will help you avoid additional expenses down the road.

American Investment Planners, LLC offers financial planning services to individuals and families across the country. Whether you are saving for your first home or looking to renovate it, we can help you create a financial plan that meets the needs of you and your family.

To schedule an appointment with one of our advisors, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

Why Should You Work With American Investment Planners, LLC in 2018?

Now is the time of the year when people focus on self-improvement. The most common way of doing this is by making New Year’s resolutions. If you’ve resolved to take control of your finances – whether that means saving more money, paying off debt, or planning for retirement – a professional financial planner can help you meet your goals.

While there are many financial advisement firms to choose from, there is only one clear option: American Investment Planners, LLC.

Here are three reasons why you should work with us in 2018:

We have decades of experience.

Our president and founder, Lee Rosenberg, has been advising clients since 1983. Over the past 30+ years, he has become one of the most respected names in the industry, and American Investment Planners has grown to manage hundreds of millions of dollars in assets each year. Our team has more than 100 combined years of experience, and many of us have gone through the same financial struggles as our clients.

We believe in individualized attention.

American Investment Planners, LLC offers the resources and experience of a large corporation, with the personalized service of a boutique firm. No one wants to feel neglected, especially by their financial advisor. That’s why we offer families the individual attention they want, along with the investment products and services they need. We don’t take shortcuts – we believe that frequent communication and customized portfolios is the only way to help our clients meet their goals.

We focus on your entire family.

We don’t just help with your finances; we strive to assist your entire family, so that your children and their children have the means they need to succeed. From college savings to retirement planning, we’ve helped individuals across all generations achieve their financial goals. Trust us to be your family’s financial planner!

Ready to schedule an appointment with one of our advisors? Give us a call at (516) 932-5130, or email info@americaninvestmentplanners.com.

What To Do If Your Company Does Not Offer A 401(k)

American Investment Planners LLC

500 North Broadway, Suite 260, Jericho, NY 11753

(516) 932-5130 / (866) 932-5130

After the initial interview is done, one of the most important questions prospective employees seek an answer to is whether or not a company offers a retirement savings plan such as a 401(k). For those that do, you're in good shape, and there is no good reason why you shouldn't take advantage of it. But for those that don't, what's your next step? Are you to just turn down the job and look elsewhere? Not necessarily, there are plenty of other ways that you can start saving for retirement, and here's how:

Contribute to a Roth IRA: Roth IRAs are similar to traditional IRAs in the sense that they have the same contribution limits; however, they are taxed differently. The funds that you contribute to Roth IRAs are after-tax dollars, but when you withdraw any amount during retirement, it is done on a tax-free basis.

Use direct deposit: A huge benefit of a 401(k) account is that you don't even really see the money you contribute until it's time to take it out - your contributions are automatically deducted from your paycheck before it's handed to you. Therefore, the effort on your part to save is pretty minimal. The good news? You can mimic this on your own by setting up a savings account (such as an IRA) where a portion of your paycheck can be deposited through direct deposit. Just like with a 401(k), you won't have anything to miss because you won't have to actually transfer funds yourself.

Open a myRA: A myRA is a new type of Roth retirement account that was established back in 2014. In these accounts, the money you save is invested in government securities that will not lose their value. The maximum account balance for this type of plan is $15,000, and you may contribute up to $5,500 each year if you earn less than $129,000 (for individuals) or $191,000 (for married couples).

Have a savings account: Although this will require you to do some money transfers on your own, a savings account is a great way to get started with planning for retirement. Each pay period, determine how much of your paycheck you can live without and transfer it from your checking to your savings account - just make a promise to yourself not to touch it! Since you can withdraw from this type of account at any time it may be tempting, but with a little will power, you'll see things start to add up.

All that said, our best piece of advice if your company does not offer a 401(k) is to meet with a financial planner who can provide you with a strategy that works best for your current financial situation. While a savings account may work for some, a Roth IRA might work better for others, and a financial planner can help you figure out what's right for you.

To learn about the retirement planning services we offer here at American Investment Planners LLC, please give us a call at (516) 932-5130.