HR PARTNERS MEETING TDA/403B - CASH MATCH - PowerPoint PPT Presentation

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HR PARTNERS MEETING TDA/403B - CASH MATCH PowerPoint Presentation
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HR PARTNERS MEETING TDA/403B - CASH MATCH

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  1. HR PARTNERS MEETINGTDA/403B - CASH MATCH • GREG SWITZER • TIAA-CREF • SENIOR INDIVIDUAL CONSULTANT • 2/16/2010 & 2/18/2010

  2. WHY DO I NEED TO SAVE?I AM NOT RETIRING FOR 30 YEARS? • BILL JONES - AGE 35 • SALARY - $35,000 • ANNUAL RAISE - 2% • WORKING YEARS - 30 • FUTURE SALARY - $64,000

  3. SOURCES OF RETIREMENT INCOME: • SOCIAL SECURITY • PENSIONS (VRS) • PERSONAL SAVINGS

  4. RETIREMENT SCENERIO • $64,000 - BILL’S SALARY AT 65 • x 80% - REPLACEMENT RATIO • $51,000 - TARGET INCOME • - $32,000 - BILL’S VRS PENSION • - $10,000 - BILL’S SOCIAL SECURITY • < $9,000> - SHORT • HOW CAN BILL COVER THIS SHORTFALL??

  5. CASH MATCH AND TDA/403B!! • BILL NEEDS TO GROW ANOTHER $200,000 IN HIS 403B/CASH MATCH ACCOUNT TO COVER THIS SHORT FALL: • $200,000 • 5% • $ 10,000 • HOW DOES BILL GET TO $200,000???

  6. OH, THE POWER OF COMPOUNDING • CASH MATCH - $40/MONTH • TDA/403B - $80/MONTH • GROWTH RATE - 6% • YEARS - 30 • FUTURE VALUE - $ 117,000 • CASH MATCH - $40/MONTH • TDA/403B - $160/MONTH • GROWTH RATE - 6% • YEARS - 30 • FUTURE VALUE - $ 195,000

  7. IMMEDIATE TAX BENEFIT: • $35,000 - BILL’S SALARY • -$ 1,920 - BILL’S TDA/403B CONTRIBUTIONS • $33,080 - TAXABLE INCOME

  8. Tax Deferred Annuity (TDA) Annual Limit - $16,500 Age 50 Catch-up - $5,500 Deferred Compensation Plan (DCP) Annual Limit - $16,500 Age 50 Catch-up - $5,500 2010 Retirement Tax Saving Limits