Mid-Career
You have some experience under your belt, now is the time to get serious about your finances.
Life Keeps Changing
You have experience to rely on, and new goals to chase.
Saving Decisions - College vs Retirement
Kids grow up. They can’t help it. And some will go to college. The popular advice is to “pay yourself” (retirement) first before you save for college. The idea is that they can borrow money for college, but you can’t borrow for retirement.
But Money magazine says you could be throwing money away if you don’t save for college in a tax-advantaged plan. Kansas has the Learning Quest 529 plan. You could earn a tax deduction for contributions, and your earnings will grow tax-free.
A Bump in the Road
You're cruising along life’s road and you hit another bump – divorce. While you’re sorting things out, don’t forget your Retirement System and KPERS 457 accounts are marital property and may be divided. Visit the KPERS Qualified Domestic Relations Order (QDRO) page for guidelines and guidance. There are other KPERS issues to consider with divorce.
Optional Life Insurance for Life Events
If the road curves, go with it. Life changes and so do your life insurance needs. Adding coverage as you need it keeps you on the road. You can add or increase life insurance within 31 days of marriage, divorce, birth, adoption or employment status change (member or spouse). Enrollment dates are based on your employer.
Cities, Counties & School Employers: September 1-30
State Agencies & Kansas Board of Regents: October 1-30
Time to Bump It Up!
Your savings that is.
How Much?
You should do as much as you can afford. Can you max out your retirement savings and stay at that level? Are you eligible for a “catch-up” bump? Eligible retirement plans let you save more than the regular max starting at age 50. Challenge yourself to cut back on spending and bump up your savings and see what happens.
Why Now?
You probably have/make more money now. And your wallet won’t feel the sting as much as it would have early in your career. Your retirement thrives on time. Time to earn and grow. You won’t be in your “savings prime” for much longer, so there’s no better time than right now.
The Pay Off
The extra money could mean the difference between retiring at age 65 and age 67. It also could help pay for the health insurance gap between retirement and Medicare, or your daughter’s wedding. All good reasons. Every dollar you put away now is worth significantly more than waiting.
Employees today seem to change jobs as often as they change their profile picture. Maybe you have an old retirement account out there, or four. Drifting. Half-forgotten. Here are some options.
If you’re thinking of leaving your money alone, look at how that old plan is performing. Is it a shining star or a black hole? Also consider fees and other costs. Want to move your money to another account (e.g. employer plan, like KPERS 457, or IRA)? Look at the regular things like performance, risk and account management.
| Four Options for a Retirement Plan After Leaving a Job |
|---|
| 1. Leave the money alone |
| 2. Roll over money into a IRA |
| 3. Transfer money to your new employer's plan |
| 4. Take the money and run |
The last option should be, well, your last option. You could face penalties and taxes that could wipe much of it away.
Mid-Career Budget Adjustments
You've got a budget in place and you're paying down your debt...slowly. Want to pick up the pace and get serious about paying it "off" not just "down"? Try adjusting your budget.
Get started by setting new spending limits. Lower your budget for fun stuff by 10-20% and put that toward your debt. Or eliminate an expense completely, but only temporarily. Ask yourself, “Can I survive with only basic cable TV for 6 months, if it means paying off a credit card? Do I really need to watch the Norwegian badminton championship quarter-finals?”
What Debt Do I Pay off First and When?
If you’re serious about paying off debt, then start right after you make a plan. Most experts recommend making the largest debt payments to loans or cards with the highest balances or interest rates (Money, May 2021). So start there. Once it’s paid off, move on to the next debt. It’s called the “snowball effect” because it helps you build momentum to crush other debt.