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Bankrate's 2008 Retirement Guide
The road ahead
There's no perfect plan for everyone but keeping with solid fundamentals is a wise path for most to follow.
The road ahead
Best retirement moves this year
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That said, there are a variety of methods to help you retain as much of your assets as possible. A trained professional can guide you through the thicket of tax pitfalls to craft the best exit strategy from your retirement accounts.

Update retirement plan documents
Spouses and nonspouse heirs -- that is, kids or an unmarried partner -- who inherit a 401(k) plan can roll them into their own IRA without paying income tax. These transfers allow nonspouse heirs to stretch out distributions of assets they inherit over their lifetimes, instead of being forced to take a huge payout. That, in turn, minimizes taxes and preserves inherited retirement funds so they can continue to grow in value.

Keep your beneficiary forms and other estate-planning documents for retirement assets up-to-date. If you don't, those hard-earned assets may wind up going to the wrong heirs. When you're married, the automatic or "default " beneficiary will be your spouse, says Martin Shenkman, an estate-planning attorney and author of "Funding the Cure." If you want that 401(k) to go to your kids, you've got to ensure beneficiary forms say so.

Be sure you have documents to protect retirement assets if someone ever has to manage your financial affairs. "You don't want someone giving away your assets if you're incapacitated," says Shenkman. "You want to safeguard assets with a power of attorney that protects you, yet authorizes someone to give you help."

Get healthy
You may not realize it, but your physical well-being may be one of the most significant factors affecting your financial status in later years.

"Health and health care-related expenses are going to play an increasingly important role in retirement savings," says Brad Kimler, senior vice president of Fidelity Employer Services Co., a division of Fidelity Investments. "Individuals who make positive lifestyle changes aren't just improving their health; they're also potentially improving their long-term financial condition, too."

Kimler's advice is borne out by recent studies from Fidelity. Among other things, it computed that a couple currently in their mid-60s who aren't covered by employer-sponsored insurance for retirees could spend roughly $215,000 on out-of-pocket medical expenses, excluding long-term care and over-the-counter medications, by the time they're 85 years old.

What's more, when your health fails, so does your ability to earn. Consider that more than half of employees -- 55 percent -- left their jobs anywhere from one to five years earlier than they expected, and among them, 22 percent had to quit early because of illness or disability.

Quitting smoking, actually using that gym membership (or hitting the running trails), eating right and keeping your weight in check are some of the savviest financial moves you can make.

-- Posted: Nov. 10, 2008
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