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Chicago Retirement Planning

Chicago retirement planning may include a Roth IRA or a Traditional IRA. Both IRAs offer different advantages and disadvantages, and choosing which to open is an important financial decision. You should spend some time evaluating your personal situation before deciding what kind of Illinois IRA to open.

You may also want to consider annuities during your Chicago retirement planning. Annuities pay a monthly benefit, usually, and so they may be a good retirement option. That way, you don't risk running out of money during your retirement, and planning your savings is easier. On the other hand, annuities can be complicated and should be approached cautiously.

IRA Versus Roth IRA

Most likely, if your employer offers an Illinois 401(k), it's your best option (especially if the company is planning to match your contributions). However, if your company doesn't offer a 401(k), or your self-employed, you may want to consider opening an IRA which allows for tax deferred growth. You can open a traditional IRA or a Roth IRA to kickstart your Chicago retirement planning.

If you're not sure whether you should open a traditional or Roth IRA, the best answer is probably to open both. Of course, you may not be able to afford contributing to both, in which case you can carefully consider both kinds of IRAs and make your best guess. The problem is that no one knows what taxes will be like 30 years from now, not even Chicago retirement planning specialists.

A traditional IRA allows you to make tax-deductible contributions from your Chicago income. If you're in a high tax bracket, this can lead to significant savings. However, your income will be taxed when you take it out of the IRA. Also, if you are planning to be in a lower tax bracket by the time you retire, you will save a fair amount.

When you contribute to a Chicago Roth IRA, on the other hand, you pay taxes before making a contribution. There are no immediate benefits, and this kind of IRA is best if you're planning to be in a higher tax bracket when you retire. Another difference is that while traditional IRAs require you to start withdrawing money at a certain age, Roth IRAs don't.

Also, Roth IRAs are tax-exempt, rather than tax-deferred which makes planning your retirement savings much simpler. A traditional IRA will eventually tax your profit, whereas you will never get taxed for a Roth IRA (except, of course, before you put the money in). This is, obviously, a safer way to invest, because you don't know what taxes will be like at the time of your Chicago retirement.

Note that you can only contribute earned income to a Roth IRA or a traditional IRA. Also, you may want to check with a Chicago retirement planning specialist about what the current limits are for contribution, too. You may be limited by your income, and there are annual limits for everyone as well. Here's something else to consider: you can convert a traditional IRA to a Roth IRA, if you want, although planning on such a conversion isn't the best idea.

Generally, Roth IRAs are more flexible, and you can take money out of your account without any penalties (you just pay taxes on it, as if it were income). You cannot take out any of your earnings, though, until you've reached a certain age (or you'll be penalized). IRAs are pretty complicated, so you may want to have a Chicago retirement planning specialist help you get started.

Chicago, IL Annuities

While you're considering the your Chicago retirement planning, you'll probably put a lot of thought into how you're going to save money for your Illinois retirement. That's important, obviously, but there's something else you need to pay attention to: how you're going to access money once you've retired. Most retirees rely on various accounts, and you may outlive your savings.

Along with your basic retirement accounts, you may want to consider annuities. Annuities are sold by brokerage houses and insurance companies, and they usually offer a monthly benefit for the rest of your life. However, if you're interested in annuities, be very careful. It's probably a good idea to consult a Chicago retirement planning before buying any annuity.

Basically, an annuity involves a contract between you and a Chicago, IL insurance company. Who trusts insurance companies? Illinois annuities can be fixed, so that your principal value never declines, or they can be variable, where you call the shots.

Here's where it gets complicated: most Chicago annuities are very expensive, but they all come with different penalties, various restrictions and so forth. It's easy to get lost in all the details of a package! Again, if annuities appeal to you, it's a good idea to consult Chicago retirement planning specialist.

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Retirement Planners In Chicago

Matthew Blume
Matthew Blume
161 N. Clark St.
Suite 2200
Chicago, IL 60601

Jim Hagedorn, CFA
Jim Hagedorn, CFA
1 N. Wacker Dr.
Chicago, IL 60606

Sam McElroy
Sam McElroy
1901 N. Clybourn Ave
Suite 302
Chicago, IL 60614

Paul Garrett
Paul Garrett
101 W. 22nd Street
Suite 200
Lombard, IL 60148

Malay Vasavda CFP, AIF, MBA
Malay Vasavda CFP, AIF, MBA
500 Lake Cook Road Suite 350
Chicago, IL 60015

Timothy Creath, CLU, ChFC
Timothy Creath, CLU, ChFC
903 Sienna Drive
Schaumburg, IL 60193

Michael Cirelli
Michael Cirelli
27575 Ferry Road
Suite 100
Warrenville, IL 60555

Thomas Koleski
Thomas Koleski
330 E. Main St.
3rd Floor
Barrington, IL 60010

Wesley Kotys, CFP, AAMS
Wesley Kotys, CFP, AAMS
175 Lincolnway, Suite D
Valparaiso, IN 46383

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