If you're one of the millions of baby boomers turning
59½ this year, 2007 will be a financial milestone of sorts. This is the
year you'll be old enough to start spending, without penalty, the money you've
faithfully stashed away in your IRAs and other retirement-savings accounts through
It may not feel like cause for a huge
celebration, but it is a good time to take stock of savings, pensions, Social
Security and all the other financial issues that seemed totally meaningless just
a few years ago when retirement was an eon away. Now you are only a handful of
years from 65, and those years will go by faster than you think.
The gold watch and other benefits. Ask the human resource department or
the accounting department to figure out what, if any, money or insurance you'll
be entitled to when you retire. If part of it is in the form of company stock
or options, ask what can be done to ensure that you'll be eligible to sell the
stock and pay taxes at the 15 percent capital gains rate instead of regular income-tax rates.
|Take this opportunity to examine these seven financial
issues while you're still in a good position to do something about them.
Hunt for missing money. Make a list of all the past employers for which
you worked for more than a year. Call the human resource departments and ask if
you are entitled to any retirement benefits. If you are, make sure that the employer
has your current address and marital status -- unless you really want your ex-spouse
to have a claim. If the plan calls for naming a beneficiary, update that information.
If your former employer has gone out of business or for some
other reason has ended its defined-benefit plan, you still may be entitled to
money. The Pension Benefit Guarantee Corp., a federal corporation created by the
Employee Retirement Income Security Act of 1974, or ERISA, will help you find
it. You can search for missing pensions at Pension
Benefit Guaranty Corporation's Web site.
you left your 401(k) plan with a former employer and lost track of
its whereabouts, try looking for it at the new National Registry of Unclaimed
Retirement Benefits search
Social Security. Social Security is under the microscope, and there could
be changes. But no matter what happens, it's probably safe to say that the longer
you work and the more you earn, the more you will get. Right now, Social Security
calculates the amount you'll receive based on earnings over the 35 years in which
you earned the most. If you have worked fewer than 35 years, then it will factor
in zeros for those years. Working more to wipe out the years in which you made
little or nothing can raise your payment significantly.