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With so many companies seeking to cut costs to survive the Covid-19-induced economic downturn, many corporate executives are now weighing the answer to a simple question: "Does it make sense to take an early retirement?"

I work closely with corporate executives from a wide range of Fortune 500 companies. These firms have seen their revenues decline in recent months and many are now changing their business model to reposition themselves. One immediate way to improve their bottom line and navigate today's volatile economic climate is to reduce the compensation and benefits paid out to top-tier executives and managers.

Fortunately, many of these companies are providing voluntary exit programs rather than surprising employees with an unexpected large layoff. These early retirement packages can give people more control over the timing of their departure and time to consider whether to participate in the program. If enough people accept the voluntary package, jobs may be spared for those who want or need to keep working.

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Over the past few weeks, I have had some conversations with several of my impacted clients and the overall feeling was that, while these executives weren't planning on leaving just yet, they didn't think they would ever see offers this good come along again.

To that point, nearly all of my executive clients at the Coca-Cola Co. applied for its "voluntary separation program," which includes some major incentives, including at least a year's pay plus a 20% bump. (The Coca-Cola Co. offered this package to about 4,000 employees working for corporate or Coca-Cola North America in the U.S., Canada and Puerto Rico.)

For corporate executives staring at a possible early and unexpected retirement, here are some recommendations to determine if the package you've been offered is the right one for you:

Assess the emotional impact of leaving your long-time employer. While the decision to take an early retirement package is primarily a financial decision, there's more to it. When an executive begins diving into what leaving their job means for their family now and into the future, I usually see a raw, emotional response about the loss of a job especially if a person has grown up with their company and given 20 years or more of service.

Take time to understand who you will be leaving many of the colleagues and friends you've known most of your career. As you consider leaving, make a list of people you want to stay connected with for personal and professional reasons once you've moved on. This will somewhat help ease the emotional blow and help build your business network for any future ventures.

Make certain the company provides key incentives. Some companies are tossing in extra incentives as part of a severance package to help make an executive's decision easier.

These incentives include allowing them to continue to participate in the company's health insurance plan, providing extra time to sell company stock grants and a premium on their lump-sum severance payment. You may also want to explore other possible benefits, such as qualifying for a partial year bonus especially if your separation is near the end of the year.

Run those numbers. Once the severance package is offered, understand its impact on your financial future. If you plan to keep working, will the severance package allow you to fast-forward plans to meet long-term financial goals, such as paying off your mortgage, funding your children's college savings accounts or building a financial reserve to buy that beach house a few years early?Or even better, is this package just the extra bump you needed to hit your retirement number?

For those who need or want to keep working, it is critical not to spend or invest the severance package "windfall" until they secure their next job. The severance payment can help tide them over and allow them to keep paying bills if they don't already have enough cash reserves in the bank.

Make certain your retirement package meets your needs. The severance package should offer enough cash to cover several months or more of your current paycheck. For example, if you would have earned $200,000 annually in pay, a package should ideally offer up at least six months of pay $100,000 to make it worth your while and minimize financial hardship.

Ideally, there are provisions to allow an executive to keep most of their stock options and restricted stock grants while forfeiting a minimal amount of the retirement benefits they've accumulated over many years. The longer you've worked there, the more retirement benefits you want to keep as part of your early retirement package.

boonchai wedmakawand | Moment | Getty Images

When it's all said and done, the most important question to answer is this: "Is this a good deal for me?"

To answer that question, make certain that you will be better off financially if you accept the package and that it keeps your financial plan on track.

Your decision to take a severance package will have a major impact on your financial future, as well as your career. By carefully analyzing it while weighing how to advance your career, you may be able to take a major step in hitting your financial goals.

By Lisa Brown, Chief Strategy Officer for corporate professionals and executives at Brightworth

Link:
Op-ed: The pandemic has forced firms to offer early retirement plans. Heres what to consider before you decide to pack it in - CNBC

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Researchers long have been sounding the alarm that Americans arent saving enough for retirement. Now, it seems, rising costs mean that even the most diligent of savers are at risk of not having enough.

A new report from the National Institute on Retirement Security, a nonprofit research institute, finds that increasing costs for housing, health care, and long-term care are major burdens for seniors across the wealth spectrum. Heres a rundown of the reports findings on those three major expenses, along with some policy recommendations from NIRS.

Housing: Older Americans are the group most likely to own a home, but 46% are carrying mortgage debt into retirement, up from 24% three decades ago, according to the NIRS report, which cites research from the Harvard Joint Center for Housing Studies.

Barrons brings retirement planning and advice to you in a weekly wrap-up of our articles about preparing for life after work.

Tyler Bond, research manager for NIRS, said many seniors likely are still paying off their mortgages because they took advantage of historically low interest rates to refinance their homes. Still, he said, its concerning that nearly twice as many seniors are carrying mortgage debt into retirement as they did 30 years ago, suggesting that money is tighter for todays seniors.

Another concern is that fewer seniors own a home today than a decade ago, and that downward trend is likely to continue because Americans who are nearing retirement are less likely to own a home than current retirees, the report says. The percentage of seniors who own a home peaked at 81% in 2012 but has dropped to about 78.5% today, according to the report.

In addition, the number of seniors considered cost-burdened by housing, meaning more than 30% of their income goes toward housing, reached 10 million in 2017, an increase of 200,000 from the prior year, the report says. Of that group, almost 5 million were severely burdened, spending more than half their income on housing.

The lack of affordable housing is a major concern nationwide, the report says, but high rents are particularly burdensome for seniors living on fixed incomes. Women tend to live longer than men, and older adults are more likely to live alone, so senior women often bear housing costs entirely on their own, frequently with a reduced income due to the death of a spouse, the report says.

This means there is a serious need for affordable housing for the oldest Americans, who are disproportionately women, and this need will grow in the coming decades as the number of much older Americans increases, the report says.

Health care: The report, citing research from Fidelity Investments, notes that a 65-year-old couple retiring in 2019 can expect to spend about $285,000 on health care in retirement. That figure includes Medicare premiums, co-pays, and prescription drugs, but doesnt include dental, vision, or long-term care.

About half of all Medicare beneficiaries spend at least 12% of their income on health care, according to the report, which cites research from the Kaiser Family Foundation, and health-care costs continue to rise.

Long-term care: With seniors living longer and baby boomers retiring, NIRS said it expects more Americans to need long-term care such as a home health aide or a nursing home, and those costs likely will continue to rise. Senior citizens today have an almost 70% chance of needing long-term care at some point, the report says, citing data from the U.S. Department of Health and Human Services.

About 10% of retirees will spend three years or more in a nursing home, with total costs typically exceeding $300,000 over that time, according to the report, which cites research from the Genworth Cost of Care Survey. That figure dwarfs the median retirement savings of workers ages 55 to 64, which is about $88,000, the report says.

To address the gap, NIRS outlines a number of possible remedies, including expanding Social Security benefits and allowing retirees to purchase annuities through the Social Security Administration.

The report also highlights the Long-Term Care Trust Act in Washington state, the first state-operated long-term-care insurance program. The 2019 law establishes a payroll tax on employees of 0.58% to provide long-term-care benefits of up to $36,500 per senior.

The state is scheduled to begin collecting the tax in 2022 and to start paying benefits in 2025. Since Medicaid is the largest payer of long-term-care costs in the nation, Washington state expects to see its Medicaid costs reduced due to this law, Bond says.

That lifetime cap of $36,500 may seem like a small amount of money, especially with some people facing these astronomical amounts for long-term care, he says. But I think its important to keep in mind that a lot of seniors wont need the most expensive forms of long-term care, and so that amount from the Washington trust fund can go a long way for those seniors who have more manageable long-term care needs.

Write to us at retirement@barrons.com

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Even Seniors Who Are Good Savers Stand to Fall Short in Retirement, Report Concludes - Barron's

DANVERS, Mass.--(BUSINESS WIRE)--Health care costs are a major expense during the Womens Longevity Gap, the period in which a woman will need to cover expenses single-handedly after the death of a male spouse or partner, according to recent data from HealthView Services, the nations leading provider of health care cost projection software. The company estimates that in retirement an average, healthy 43-year-old woman will face nearly $200,000 more in health insurance premiums than her husband.

The company, which provides software for personalized health care cost projections to financial professionals, urges women and couples to start planning early to address the longevity gap.

HealthView Services encourages thoughtful, personalized planning for the disparities of age, income, and life expectancy that commonly exist among male/female couples. Recommendations include:

Following these steps, women and their financial advisors can mitigate and potentially even eliminate the longevity gap and the other challenges that are common among female retirees, said Ron Mastrogiovanni, CEO of HealthView Services. Financial advisors with the right tools and data at their fingertips have the power to help their female clients close that longevity gap.

About HealthView Services Founded in 2008, HealthView Services is the nations leading provider of healthcare cost projection software, built on a dataset of 530 million health care claims. Its portfolio of retirement healthcare planning applications centered on personalized longevity estimates and individual health care cost projections is used by advisors, financial institutions, employers and consumers to create comprehensive, reliable health cost projections for 33 million users annually. Visit us to know more: http://www.hvsfinancial.com.

Originally posted here:
Women's Health Care Costs in Retirement Projected to be $200000 More than Men's - Business Wire

BERWYN, Pa.--(BUSINESS WIRE)--Trinseo (NYSE: TSE), a global materials company and manufacturer of plastics, latex binders, and synthetic rubber, announced that two members of its board of directors, Stephen M. Zide and Christopher D. Pappas, have decided to retire from the board effective September 30, 2020. In light of Mr. Zides and Mr. Pappas decisions, the board has appointed Jeanmarie Desmond and Matthew Farrell as their replacements, effective October 1, 2020 and November 1, 2020, respectively.

On behalf of the Company and the board, I want to thank Steve and Chris for their leadership and dedication to Trinseo over the past 10 years, said Frank Bozich, President and CEO, Trinseo. They were both founding members of our board, and our success would not have been possible without them. I am personally thankful for their guidance and direction over the years and during my onboarding into the company.

Mr. Zide has served as Chairman of the Board since 2010. Mr. Pappas served as the Companys President and Chief Executive Officer from 2010 until his retirement in 2019 and has also been on the board of directors since 2010. As the boards longest-tenured members, Mr. Zide and Mr. Pappas were instrumental in transitioning Trinseo from a carve-out business into a fully independent standalone public company.

Im grateful for the strong foundation that Mr. Zide and Mr. Pappas have created which continues to serve the Company, Bozich continued. Moving forward, we are excited to welcome Jeanmarie and Matthew to the board as we embark on a very exciting future and set out to achieve our strategic objectives and our recently announced sustainability goals. Their combined experience in the chemical space will be invaluable to our continued growth and innovation as a materials solutions provider.

About the Incoming Directors

Jeanmarie Desmond is the former Executive Vice President and Chief Financial Officer of DuPont de Nemours, Inc. and has previously served as Vice President and Co-Controller for DowDuPont and as finance leader for the Specialty Products division following the merger of DuPont with Dow Chemical. Ms. Desmond brings substantial finance experience and extensive experience in the chemicals industry to the board of directors.

Matthew Farrell is the Chairman, President and Chief Executive Officer of Church & Dwight Co. Inc., serving since 2016 and as Chairman since 2019. Mr. Farrell served as Executive Vice President, Chief Financial Officer and Chief Operating Officer at Church & Dwight since 2014, and as its Chief Financial Officer since 2006. Mr. Farrell brings to the board of directors his experience as a chief executive officer, substantial financial and audit expertise and experience in the chemicals, industrial goods and consumer products industries.

About Trinseo

Trinseo (NYSE:TSE) is a global materials solutions provider and manufacturer of plastics, latex binders, and synthetic rubber with a focus on delivering innovative, sustainable, and value-creating products that are intrinsic to our daily lives. Trinseo is dedicated to making a positive impact on society by partnering with like-minded stakeholders, and supporting the sustainability goals of our customers in a wide range of end-markets including automotive, consumer electronics, appliances, medical devices, packaging, footwear, carpet, paper and board, building and construction, and tires. Trinseo had approximately $3.8 billion in net sales with 2,700 employees globally in 2019. For more information, please visit: http://www.trinseo.com.

Cautionary Note on Forward-Looking Statements

This press release may contain forward-looking statements including, without limitation, statements concerning plans, objectives, goals, projections, expectations, strategies, future events or performance, and underlying assumptions and other statements, which are not statements of historical facts. Forward-looking statements may be identified by the use of words like expect, estimate, will, may, or expressions of similar meaning. Forward-looking statements reflect managements evaluation of information currently available and are based on the Companys current expectations and assumptions regarding the impact from the COVID-19 pandemic, the Companys business, the economy and other future conditions. Specific factors that could cause future results to differ from those expressed by the forward-looking statements include, but are not limited to, risks related to the ongoing impact of the COVID-19 pandemic and those discussed in the Companys Annual Report for the year ended December 31, 2019 filed with the Securities and Exchange Commission (SEC), in subsequent Quarterly Reports on Form 10-Q and in other filings and furnishings made by the Company with the SEC from time to time. Other unknown or unpredictable factors could also have material adverse effects on the Companys performance. As a result of these or other factors, the Companys actual results may differ materially from those contemplated by the forward-looking statements. The forward-looking statements included in this press release are made only as of the date hereof and are not a guarantee of future performance. The Company undertakes no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

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Trinseo Announces the Retirement of Stephen M. Zide and Christopher D. Pappas from Its Board of Directors - Business Wire

It's a terrible mistake to ignore dividends when you're investing, as they can be powerful aids in growing your portfolio while you're still working, and they can serve you particularly well in retirement, too. But don't think of dividend-paying stocks as only appropriate for older investors.

Here's a look at five key reasons you should consider adding some (or many) dividend-paying stocks to your portfolio.

Image source: Getty Images.

The first reason is perhaps the most obvious one: Dividend-paying stocks generate income. As an example, if you have a portfolio worth $400,000 with an average dividend yield of 3%, you're positioned to receive $12,000 each year, just from dividends. That money can be reinvested in additional shares of stock, to plump up your portfolio further, or it can be used for living expenses.

Dividends aren't typically static, either: When they're being paid out by healthy and growing companies, they tend to be increased over time -- often annually. This can help your income streams keep up with inflation, which has averaged about 3% annually over long periods.

Check out a few examples below.

Company

Recent Dividend Yield

5-Year Avg. Annual Dividend Growth Rate

Starbucks

2%

20.7%

Microsoft

1.1%

10.5%

PepsiCo

3.1%

7.8%

Target

1.8%

4%

Chevron

7.2%

3.8%

Data source: Author calculations, Yahoo! Finance.

When you search for dividend-paying stocks for your portfolio, look not only for a meaningful yield, but also a payout that's growing well over time.

Another upside of dividend-paying stocks is that they're often relatively stable, compared to stocks of other companies. This is not always true, of course, but in general, for a company to commit to paying its shareholders a certain sum on a regular basis, its managers will be fairly confident of reliable revenue and earnings. That's why you'll find that a large proportion of blue-chip stocks are steady dividend payers. (On the other hand, many relatively young and fast-growing companies do not pay dividends at all, because they're plowing every available dollar into furthering their growth.)

Remember, too, that dividend-paying stocks don't merely offer dividends. The shares are still tied to companies that are working hard to grow and become more valuable over time. Thus, if you invest in healthy and growing dividend payers, you'll likely enjoy not just dividend income that increases over time, but also a stock price that increases over time -- and not necessarily at a paltry rate.

Indeed, when academics Eugene Fama and Kenneth French studied stock market data from 1927 to 2014, they found dividendpayers outperformed non-payers, averaging 10.4% annual growth vs. 8.5%. Here are some more examples of dividend payers:

Company

Recent Dividend Yield

10-year Avg. Annual Stock Growth Rate

Sherwin-Williams

0.8%

25.2%

Lowe's

1.5%

23%

Nike

0.8%

21.2%

Costco

0.8%

19.8%

Amgen

2.6%

17.4%

Discover Financial Services

3.3%

14.4%

Clorox

2.1%

13.9%

Kroger

2.2%

13.1%

Verizon Communications

4.3%

9.7%

Data sources: Yahoo! Financial and theonlineinvestor.com.

Finally, if you're relying on income from dividend-paying stocks in retirement and you end up not needing to sell off those shares over time for additional cash, you'll be able to leave them to your loved ones. This is a meaningful advantage over some other income-producing options, such as annuities. Fixed annuities have the advantage of providing even more reliable income, and they are worth considering in your retirement planning. Indeed, you may end up wanting to set up income streams in retirement from both annuities and dividends.

Don't dismiss dividends as only suitable for older investors and retirees. They have a lot to offer investors at every stage of life.

Originally posted here:
5 Reasons to Invest in Dividend-Paying Stocks for Retirement - The Motley Fool

GARDNER Fire Chief Richard Ares was honored by local and area elected officials as he prepares to call it a career after nearly half a decade on the job. Ares will retire on Wednesday, Sept. 30, after 47 years with the department.

Ares decades of service to the city were recognized by U.S. Rep. Lori Trahan, D-3rd, on Monday, Sept. 28. While at the department to officially announce a $240,000 federal grant her office helped secure for the purchase of new breathing equipment, Trahan said she used the opportunity to present Ares with a congressional proclamation to honor his exemplary service to the city.

Chief Ares has devoted his entire life to the city of Gardner, where he has always called home, obtained a degree in fire science from Mount Wachusett Community College, and began his honorable 47-year career on the Gardner Fire Department, Trahan read from the document. The residents of Gardner, as well as the commonwealth of Massachusetts, are grateful to Chief Ares for his extensive (career) as a firefighter, where he faced continual danger without hesitation for the betterment of his community.

Ares said stepping down for the job he has loved is a bittersweet moment.

Obviously, Im going to miss it, Ares said. The part Im going to miss most the guys were asking me this this morning is running to calls. I still love running to calls and doing the so-called street work, but its been a good ride, its been a good time, and its been what Ive always wanted to do, even when I was a little kid. I feel lucky that I got to do what I always wanted to do.

Ares started with the citys fire department as a substitute call firefighter in 1973, becoming a permanent member two years later. He climbed through the ranks of the department, serving as a fire lieutenant for 20 years, and then captain, and eventually fire chief. During his tenure he was selected as a fire investigator, providing skilled analysis in the wake of countless emergencies. He devoted nearly 12 years to teaching life-saving techniques and training fire recruits from across the state as an instructor at the Massachusetts Firefighting Academy.

The job has changed greatly over the years, Ares said, adding that he began keeping a journal of all of the calls he went on starting in 1983. As I go back through the old records, I see that we didnt do as many calls (in the past), but the majority of them were fires. Now, were actually more of an all-hazards department more than truly a fire department we handle all kinds of emergency incidents. People call us for everything.

Mayor Michael Nicholson said the city is grateful for Ares years of service to the community and its residents.

If you spend 47 years and five months in one community thats dedication in and of itself, Nicholson said. Our birthdays are a day after each other. I just turned 26 and he just turned 65, so for all of my life, hes been here in Gardner just making a difference. And I think thats incredible.

Nicholson noted that his relationship with Gardners longtime chief extended beyond the city limits.

When I was marching in the UMass marching band, he was the official photographer for the band, so weve been joking that now that hes leaving the fire department, his photography services will be better, Nicholson said. But I cant thank him enough for all hes done here. You cant look at the Gardner Fire Department and not see the impact that Richard has made here. So Im looking forward to seeing him relax but also to see how we can continue the work he started here as we move forward.

State Rep. Jon Zlotnik, D-Gardner, said Ares commitment to the city has meant a lot to its residents for nearly half a decade.

Gardner is a city, but I always say its a big town, and people like Chief Ares really dedicate their whole lives to the city and make things better, said Zlotnik. You look at a lot of the changes the chief has brought to the department to modernize it especially when it comes to equipment and training I think that has really been a focus for him, and those crucial decisions are always paramount whenever youre talking about firefighting services.

City Hall would be lit up in red over the next few days in honor of Ares years of service to the city, Nicholson said.

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Gardner Fire Chief Richard Ares honored on the eve of his retirement as U.S. Rep. Lori Trahan officially announces $240K grant for his department -...

Having a six-figure budget in retirement requires a large nest egg.

You will need to save at least $2 million if you want to spend $100,000 per year in retirement, according to experts. This scenario assumes that you withdraw 5% of your savings per year, which leaves little room for error.

But you shouldn't plan your retirement based on best-case scenarios.

You should aim to spend around 4% of your nest egg per year in retirement, according to financial advisor Winnie Sun. That percentage can drop, however, based on several factors such as if your home isn't paid off or if you have high health-care costs, Sun said.

This strategy also assumes that you have a balanced portfolio, focusing more on bonds and cash-type investments for your short-term needs. This allows the stocks in your portfolio to grow for the future, according to Sun.

Check out this video to see a few different case studies of how much spending money you'll have if you retire on $2 million.

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Here's what your monthly budget will look like if you retire with $2 million - CNBC

David Parmer announced his retirement as CEO ofBaptist Hospitals of Southeast Texas on Sept. 29, 2020.

David Parmer announced his retirement as CEO ofBaptist Hospitals of Southeast Texas on Sept. 29, 2020.

Photo: Courtesy Of Baptist Hospitals Of Southeast Texas / Courtesy Of Baptist Hospitals Of Southeast Texas

David Parmer announced his retirement as CEO ofBaptist Hospitals of Southeast Texas on Sept. 29, 2020.

David Parmer announced his retirement as CEO ofBaptist Hospitals of Southeast Texas on Sept. 29, 2020.

Parmer to retire as Baptist CEO after more than 30 years

David Parmer has led Baptist Hospitals of Southeast Texas through growth, change, pandemic and more than a few natural disasters as CEO of the health group for more than three decades, but after next summer he will be passing on its future to the next generation of leadership.

Parmer announced his retirement Tuesday and will be stepping down as CEO at the end of next June. He will be staying on in an advisory role for two years during the leadership transition, according to the health group.

Parmers decision was announced by the health groups board of directors, who heralded his time with Baptist.

The entire board is extremely supportive of Davids decision and thankful for his many years of friendship and exemplary leadership, Gary Coker, board chair, said in a statement. Board members, hospital staff at all levels and the community at large have greatly benefited from Davids highly participative leadership style, sense of commitment to Baptist Hospital, and desire to reach the best solutions and decisions during the best and worst of times. David has truly been a great leader.

Baptist Hospitals of Southeast Texas was founded in 1945 to answer a shortage of hospital beds in Beaumont. Baptist celebrates its 75th anniversary this year.

Parmer joined Baptist in 1989 after gaining administration experience at hospitals and health groups in Louisiana. He previously worked as a controller with the U.S. Department of Veterans Affairs but decided to head to graduate school at the University of Alabama-Birmingham in search of a career that would allow him to help people beyond the finance world.

Early in his career, he had to oversee the creation of a new hospital in central Beaumont and the decommissioning of the old one.

Services at the hospital expanded under his tenure and Baptist joined with the Cancer Center of Southeast Texas and Altus Cancer Center to create the Baptist Hospitals of Southeast Texas Regional Cancer Network in 2017.

Parmer and Baptist as a whole have had to adjust to changing dynamics in health care, such as rising costs and migration of inpatient services to other offices.

In 2016, the decision was made to close the emergency room at the former Orange hospital, ending Baptists services in that area.

As CEO, Parmer also had to lead the hospital through disasters such as hurricanes and most recently the COVID-19 pandemic.

Parmers predecessor will be chosen by a newly appointed search committee and the Witt Kieffer executive search firm.

Candidates will be interviewed between January and February 2021 with the plan to have final candidates visit Beaumont between March and April. Baptist anticipates a new CEO will assume office by the end of June 2021.

jacob.dick@beaumontenterprise.com

twitter.com/jd_journalism

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Parmer to retire as Baptist CEO after more than 30 years - Beaumont Enterprise

For Americans with access to them, workplace 401(k)s can be the simplest type of retirement account. After all, signing up for one just involves doing a little paperwork and requesting to have money withheld from your paychecks. And in some workplaces, the default is to auto-enroll you, so you really don't have to do much of anything. Many employers even offer matching funds, so you get access to free money by contributing.

But while you definitely want to put at least enough into your 401(k) to earn the maximum employer match, using a 401(k) as your only retirement account may not be the best move. In fact, there are some big pitfalls to putting your money into this account exclusively. Here are three of them.

Image source: Getty Images.

Most 401(k) accounts offer a very narrow pool of investment options. You're usually restricted to a few index funds or target date funds and cannot purchase shares of individual stocks. If you invest some of your money in an IRA, however, you'll have access to a much wider pool of investments -- any that your brokerage of choice offers. You can even open up an IRA that allows you to choose non-traditional assets, such as gold or bitcoin.

While you take on more risk by buying shares of individual companies -- and alot more risk by buying some of those non-traditional assets -- you also have the potential for much higher returns than if you stick to just the funds your 401(k) provides. If you're willing to branch out and put in the time to find the right investments, it's definitely worth putting some of your retirement money in accounts that give you more freedom.

Some 401(k) accounts have management or administration fees that eat into your returns. The funds your 401(k) allows you to invest in may also carry higher fees than others that might be available with the broader range of choice a brokerage firm provides.

Fees can make a measurable impact on the amount of money you end up with in retirement. If your workplace plan has them in abundance, you're doing yourself a real disservice if you use it as your exclusive retirement account. Instead, in this situation, you should only contribute enough to get the match and then look for a broker that offers a no-cost IRA with a choice of affordable investment options.

Distributions from a 401(k) are taxed at your ordinary income tax rate. Distributions from a Roth IRA or Roth 401(k) are not taxed. If you have access only to a traditional 401(k) at work and use it as your sole retirement savings account, you'll owe more in taxes in your later years than you would've if you'd put some of your money into a Roth IRA and taken tax-free distributions to help support you.

Social Security benefits also become partially taxable once your income hits $25,000 as a single tax filer or $32,000 as a joint tax filer. But not all income is countable. Your 401(k) distributions are included when determining if Social Security benefits will be taxed, but distributions from Roth accounts aren't. If you put all your retirement savings into a 401(k) and withdraw enough to cross the threshold at which you owe tax on Social Security, you'll owe even more money to the IRS that you wouldn't have if you'd received some Roth income instead.

Since you could reduce the size of your nest egg by getting hit with fees and limiting your investment options and get to keep less of your money due to higher tax bills, sticking with a 401(k) alone could really hurt your prospects for financial security in retirement. Instead, consider splitting your money up among several different retirement plans so you can reap the benefits that each provides.

Read this article:
3 Pitfalls of Only Using a 401(k) for Retirement - The Motley Fool

Knowing where you spend your money has gotten easier and easier, thanks to programs like Quicken and websites like Mint.

The late economic historian W.W. Rostow had long-term roles in the administrations of two presidents. But hes probably best remembered for his 1960 response to the challenge of communism.

It was a book titled The Stages of Economic Growth: A Non-Communist Manifesto.

In it, Rostow identified five stages of economic development. The stage most people talked about was the "takeoff, the moment when a nation saved enough that the savings per capita began to grow.

Thats also when income began to grow. And when new opportunities appeared. Its when a nation could get off the Malthusian treadmill with population growth exceeding any increase in savings. Rostow looked around the world. He saw getting to that moment as a challenge and an opportunity.

I loved that book. It set a great mood of possibility and mission.

But if entire nations have a takeoff point, so do we as individuals. So do family households. Better still, if we reach our takeoff point, were on the way to getting off the payday treadmill. Were on the way to a secure retirement at least, or early financial independence at best.

The sad part is that so few get there.

Many never reach their takeoff point. Instead, they buy a new car, take an expensive vacation or decide their 4,000-square-foot house desperately needs an outdoor kitchen. They borrow to spend. They guarantee they will be repaying debts rather than starting to save or adding to savings. They choose to own things that decline in value rather than appreciate. They collect things that consume income rather than create it.

Were not talking about the clueless here. An abundance of survey evidence shows that millions of people live in a financial condition that can only be described as precarious.

An amazing number of people missed the takeoff point memo.

So lets answer a simple question: How do you reach your takeoff point?

Spend less than you earn.

Its that simple.

Trouble is, no one wants to figure out how they spend their money.

Let me repeat that. NO ONE.

Ive been writing a personal finance column since 1977. I still havent run out of fingers for counting the number of people who can immediately say, Last year I spent this much on (insert category), spent this much on taxes and added this much to my savings.

But heres a blunt reality: If we dont make positive decisions about where and how we spend our money, well never control our spending. Well always be the victim of an impulse or a particularly effective advertisement.

Is there any good news here?

Yes! Knowing where you spend your money has been getting easier and easier. It doesnt require taking up permanent residence under a green eyeshade.

If you want to be detailed and fastidious, you can use a computer program such as Quicken. In a few months, youll know exactly where your money goes.

If thats too much bother, you may be able to do it through the services that run automatically on your bank account, your debit card and credit card. You can also put it all together by using Mint, a free online money tracker.

The important thing isnt how you do it, but that it gets done.

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Whats your takeoff point? The moment youve saved enough for retirement - The Dallas Morning News