Investments at the time of Retirement

Radio Transcript, 2 minutes 25 seconds, for use during week of Feb. 25.

Description: Penny and Susan discuss preparing for retirement

Announcer: Invest Wisely comes to you from Iowa State University Extension through a grant from the Investor Protection trust, providing investor education on the web at: investorprotection.org.

Susan: Penny, I’m still a few years from retiring, but I’d like to ask you some questions about preparing as I approach retirement age.

Penny: Great!  As you're getting closer to retirement, you're probably discovering that there are a number of decisions you need to make.

Susan: Just where do I start?

Penny:  Tell me a little about your current investments for retirement.

Susan: Well, I have an investment plan at work and an Individual Retirement Account.

Penny: Do you have any other investments that you've earmarked for retirement?

Susan: A few.

Penny: Ok.  Let's talk about your retirement plan at work.  At some point you'll have to make some choices about how you want to receive the money you've accumulated in your retirement plan.

Susan: What sorts of choices?

Penny: Every plan will have its own rules.  You can start by checking with your benefits office to find out what rules apply to your particular pension plan.

Susan: Aren't things pretty much the same for everyone when they retire?

Penny: I think you'll find that everyone's circumstances are a little bit different.  The best choices for you will depend on your age and health, your investment skills, how important security is to you, your tax situation, and the company’s economic health.

Susan: That's a lot to consider.

Penny: You'll want to take your time and be sure you make the right decision for you.  Some people take a lump sum and invest the money themselves, some choose to roll over the amount to a traditional IRA or to a Roth IRA depending on the circumstances.  Some pension plans may let you receive your payout as a lifetime annuity or as a joint and survivor annuity where payments are made over your lifetime and the lifetime of a designated survivor.

Susan: Thanks so much, Penny.  This is a lot to think about.  I'd like to come back again and talk and ask more questions as I prepare for retirement.

Penny: You’re welcome.  And remember, for more information visit the ISU Extension website at extension.iastate.edu and look for ‘Invest Wisely.’