inheritance and how to use it for retirement
Terry, My mom recently passed way and left us kids about 60K each. I am 50 years old and would like to invest this money for my retirement and try to catch up. Right now I have 75K in an IR roth and about 50K cash on hand. How can I make this money work hard for me and building my retirement? Thanks,
Terry Says
I'm sorry for your loss. I hope you are impressed with your mother's ability to work and save that much money for each of her children. And I can understand why you want to invest it wisely. First of all you'll want to see what you can do about creating a tax-deferred investment. Are you still working? If so, at age 50 in 2017 you can contribute as much as $6500 to an IRA -- either a traditional deductible IRA, a non-deductible IRA, or a ROTH IRA -- depending on your income. Here's a link to those income/contribution limits. I would contact Fidelity or Vanguard to open an account, or my personal all-time favorite fund (in which I have been invested forever!) contact T. Rowe Price and use their Equity-Income fund. It's a bit more conservative than an S&P 500 stock index fund. That will account for about half that money over the next few years. Of course you can invest in the same funds OUTSIDE a retirement plan. But don't be in a big rush to invest it all in the stock market. The market has come a long way in recent years. And you might be glad to have a cash cushion on the side. You're probably getting to the stage when you could talk with a financial advisor -- but a FIDUCIARY (see recent columns) not a SALESPERSON! Search at www.feeonly.org. But first learn more at http://www.campaignforinvestors.org/ There you will learn what questions you should ask of a financial advisor -- and what they should be asking YOU!
