Retirement is a crucial stage in your life, given how drastically your finances may change after retirement. It is, thus, essential to plan your retirement income well in advance to ensure that you get a smooth post-retirement experience. Here are the top 10 retirement plans which will ensure that your retirement is a merry affair:
1. 401(k): The 401(k) investment plan is offered by the employer to help the employee invest and save a part of their salary before taxes are deducted. One can choose to layer funds in a range of options such as mutual funds, bonds, etc. as sources of post-retirement income.
2. Defined Contribution Plan: Like 401(k) investment plan, various plans like the 403(b) are great options to raise funds and meet your post-retirement demands.
3. Roth IRAs: It is an individual retirement account funded with tax dollars where the beneficiary (retiree/nominee) is allowed to make pre-tax contributions to the employer.
4. SEP IRAs: The simplified employee pension plan is an excellent post-retirement plan if you are self-employed with no employees.
5. Cash/Value Life Insurance Plan: Once you achieve the cash value of the plan, you can take a loan against your death benefit that will serve as an excellent tool of revenue post retirement.
6. Social Security: It is one of the most popular retirement plans among Americans for its high rate of payout.
7. Nonqualified deferred contribution plan: You can choose an NQDC if you’re barred by income in a Roth IRA.
8. Traditional IRAs: Similar to Roth IRAs, traditional IRAs are not subject to income restrictions.
9. Guaranteed Income Annuity: Annuity allows you to invest in the present day and get some guaranteed return when you retire.
10. Real Estate: As against the risks involved, real estate can offer great opportunities to generate income.