Ten Steps to Seven Figures

Barbara O’Neill, Extension Specialist in Financial Resource Management

Rutgers Cooperative Extension

oneill@aesop.rutgers.edu

April 2019

Ten Steps to Seven Figures

One of the most frequently cited purposes of investing is to build wealth for future financial goals such as a new car, a college education for children, and financial security in later life. Many people even have a specific dollar amount in mind such as having $1 million saved by the time that they stop working. 

 

Below are ten recommendations to …

Can Money Withdrawn From a 403(b) Plan in Retirement Be Put Into a Roth IRA?

It depends. You must have earned income to contribute to an IRA of any type, including a Roth IRA. This means that you must have a salary, hourly wage, or net earnings from consulting or a small business.

If you have earned income, the maximum amount that a person over age 50 can deposit in 2017 in a Roth IRA is the larger of 100% of earnings or $6,500 (the regular $5,500 contribution plus an additional $1,000 catch-up contribution). Roth …

Monthly Investment Message: February 2017

Barbara O’Neill, Extension Specialist in Financial Resource Management

Rutgers Cooperative Extension

oneill@aesop.rutgers.edu

February 2017

Factors That Affect Investment Risk Tolerance

To help investors objectively assess their investment risk tolerance, Rutgers Cooperative Extension has an online Investment Risk Tolerance Quiz at www.rce.rutgers.edu/money/riskquiz 

Developed by Dr. Ruth Lytton at Virginia Tech and Dr. John Grable at the University of Georgia, the quiz has 13 multiple choice questions and provides users with instant feedback about their capacity to handle investment risk. 

 

The questions …

How Does a Target Date Mutual Fund Work?

With a target date mutual fund, investors simply need to pick a fund with a date at or near the year that they expect to retire. For example, there are funds with dates such as 2020, 2030, 2040, and 2050 in their title.

The fund manager will gradually change the asset allocation of the fund as time goes by so that, eventually, there will be a smaller percentage of the portfolio in stocks and a higher percentage in bonds and …

How do Spousal IRAs Work?

Spousal IRAs are a type of individual retirement account designed for married couples where one spouse is not employed. The working spouse may contribute up to $5,500 per year (2017 figure) to an IRA, in the name of the non-working spouse, and up to $5,500 per year to his or her own IRA. As a result, a couple may contribute 100% of their income up to a total of $11,000 per year (2017 figure).

In addition, if you are age …

How Do You Purchase Stock From a Company That is Going Public?

You are talking about an IPO (initial public offering). You should be able to get information (e.g., company research) from a stockbroker. Also, visit an online search engine (e.g., Bing or Google), type in the company name, and see what information you get. If there is an address or toll-free telephone number for the company’s “shareholder relations” department, call it. As for purchasing an IPO stock, you may or may not be able to buy shares directly from the company. …

Banking Experience and Individual Development Accounts

Grinstein-Weiss, M., Yeo, Y. H., Despard, M. R., Casalotti, A. M., and Zhan, M. (2010). Does prior banking experience matter? Differences of the banked and unbanked in Individual Development Accounts. Journal of Family and Economic Issues 31, 212-227.

Brief Description: This study compares the saving performance and program participation of participants who owned bank accounts and those who did not prior to program enrollment in 14 Individual Development Account programs. Banked participants were shown to have higher average monthly net …

Effect of Expressing a Quantitative Goal on Savings Behavior

Loibl, C. & Scharff, R. L. (2010). Examining the effect of expressing a quantitative goal on consumer savings. Journal of Consumer Affairs, 44, (1): 127-154. http://dx.doi.org/10.1111/j.1745-6606.2010.01160.x.

Brief Description: The study extended the psychological concept of implementation intentions to the analysis of savings behavior. A field experiment was conducted with current participants of an America Saves campaign in a large city in a U.S. Midwestern state. The intervention required the treatment group participants to write down specific plans about the …

Managing a Retirement Portfolio: Do Annuities Provide More Safety?

Spitzer, J.J. (2009). Managing a retirement portfolio: Do annuities provide more safety? Journal of Financial Counseling and Planning Education, 20(1), 58-69.

Brief Description:  One of the biggest concerns of retirees is the risk of outliving their assets. This study used a technique called “bootstrap simulations” to estimate the probability of someone outliving a retirement portfolio as increasing proportions of a tax-deferred account are annuitized. It also examined the sizes of the portfolio balance as the annuity amount increased. Required …