Recovery Plan
U.S. News & World Report (06/03/02) p.80; Lim, Paul J.

Seniors are becoming the fastest-growing group of bankruptcy filers as stock market losses over the past couple of years have diminished the investments of many, and left retirees wondering how they will survive. Experts say that retirees should try to hold off for as long as possible on cashing in 401(k)s or other retirement accounts, letting them grow tax differed, meanwhile relying on Social Security, pensions, and other forms of income. Retirees should take advantage of recent tax law changes allowing workers over 50 to contribute up to $3,500 annually into individual retirement accounts or $12,000 into 401(k)s. Those with homes can trade down to less expensive homes, or consider a reverse mortgage to allow them access to the equity in their homes for extra income.


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