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Financial literacy is essential as you navigate the waters of retirement readiness, influencing your ability to manage the complexities of retirement planning effectively. A recent survey by the
Global Financial Literacy Excellence Center (GFLEC) and the TIAA Institute highlights
knowledge gaps that significantly impact retirement outcomes.
One of the survey's critical questions involved the optimal strategy for enhancing retirement savings through employer-sponsored plans. Consider the scenario where Latisha, planning to set aside $2,000 annually for retirement, benefits from her company’s match up to $5,000 per year in a 401(k) plan. Both an IRA and a 401(k) offered a 5% return, but the poll indicated that investing in the 401(k) was the better choice for Latisha to leverage the full employer match, culminating in a substantially larger year-end balance of $4,200, as opposed to $2,100 via an IRA.
This example underscores the importance of understanding Eversource Energy retirement benefits and the tangible impact of financial decisions. Additionally, the survey revealed that only 42% of participants knew that Social Security benefits are calculated based on the 35 highest-paid years of employment, not just the last two.
The survey results show a concerning disparity: a mere 75% of those who correctly answered four out of five questions felt prepared for retirement, versus 41% of those who answered none. This indicates a strong link between financial knowledge and confidence in achieving a comfortable retirement.
Financial literacy encompasses more than academics; it involves a deep understanding of various fields, including human psychology and econometrics. For instance, deciding when to start receiving Social Security benefits involves weighing nearly a hundred different factors. The complexity of these decisions highlights the critical nature of thorough financial preparation and education.
Being financially literate is not just about knowledge; it’s about being ready to seize opportunities. The famed investor Benjamin Graham, renowned for his book 'The Intelligent Investor' and mentoring Warren Buffet, emphasized the importance of preparedness and discipline as key drivers behind successful investments and major decisions.
Consulting with a certified financial planner can provide guidance and clarity for those overwhelmed by the depth of knowledge required. Financial planners are adept at crafting a personalized plan that aligns with each client’s unique financial goals and circumstances.
April is National Financial Literacy Month, an excellent time to assess your financial health. In support of this initiative, MarketWatch releases a series of 'Financial Fitness' articles that offer practical financial planning tips and encourage readers to evaluate their investment and saving strategies.
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- How Are Workers Impacted by Inflation & Rising Interest Rates?
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Understanding the basics of retirement planning and the nuances of investment options can significantly impact your financial stability in later years. The TIAA Institute and GFLEC survey serves as a potent reminder of the need for ongoing learning and engagement with financial concepts.
It is vital for Eversource Energy employees, especially those nearing retirement, to be vigilant against common tax scams. The IRS warns that scammers often target retirees, posing as IRS officials to extract immediate payment or personal information through social media, emails, or phone calls. Employees should know that the IRS will never contact them through these mediums for private information. Always verify the authenticity of any communication through official IRS channels. This advice is particularly crucial during tax season when scammer activity increases.
Navigating retirement planning is like steering a ship through unfamiliar waters, and Eversource Energy employees on the brink or in the midst of retirement must become adept in their financial landscape. This includes maximizing a 401(k) and understanding Social Security intricacies, but also being acutely aware of the deceptive currents of tax scams targeting retirees. Armed with financial knowledge and vigilance against scams, retirees should, like seasoned captains, navigate these challenging waters with a reliable map and sharp lookout.
What is the Eversource Energy 401(k) Savings Plan?
The Eversource Energy 401(k) Savings Plan is a retirement savings plan that allows employees to save a portion of their salary on a pre-tax or after-tax basis, helping them build a financial foundation for retirement.
How can I enroll in the Eversource Energy 401(k) Savings Plan?
Employees can enroll in the Eversource Energy 401(k) Savings Plan through the company's benefits portal or by contacting the HR department for assistance.
What is the employer match for the Eversource Energy 401(k) Savings Plan?
Eversource Energy offers a competitive employer match to encourage employee participation in the 401(k) Savings Plan. Specific matching contributions can vary, so it's best to check the plan documentation for details.
Can I change my contribution rate to the Eversource Energy 401(k) Savings Plan?
Yes, employees can change their contribution rate to the Eversource Energy 401(k) Savings Plan at any time through the benefits portal or by contacting HR.
What investment options are available in the Eversource Energy 401(k) Savings Plan?
The Eversource Energy 401(k) Savings Plan offers a variety of investment options, including mutual funds, target-date funds, and company stock, allowing employees to tailor their investment strategy.
Is there a vesting schedule for the Eversource Energy 401(k) Savings Plan?
Yes, the Eversource Energy 401(k) Savings Plan has a vesting schedule for employer contributions. Employees should refer to the plan documents for specific details on the vesting timeline.
What happens to my Eversource Energy 401(k) Savings Plan if I leave the company?
If you leave Eversource Energy, you have several options regarding your 401(k) Savings Plan, including rolling over your balance to another retirement account, cashing out, or leaving it in the plan if permitted.
Can I take a loan from my Eversource Energy 401(k) Savings Plan?
Yes, Eversource Energy allows employees to take loans from their 401(k) Savings Plan, subject to certain conditions and limits. Employees should review the plan's loan policy for more information.
Are there hardship withdrawals available in the Eversource Energy 401(k) Savings Plan?
Yes, Eversource Energy permits hardship withdrawals from the 401(k) Savings Plan under specific circumstances. Employees must meet certain criteria to qualify for a hardship withdrawal.
How often can I review my Eversource Energy 401(k) Savings Plan statements?
Employees can review their Eversource Energy 401(k) Savings Plan statements quarterly, and they can also access their account information online at any time.