The Retirement Plan Mid Year Check Up

By on June 5, 2018

Are you living up to your New Year’s promise to put more aside each month for retirement savings? Have you even started? Maybe you are five or ten years from retirement and need to save a bit more to afford the lifestyle you want?

Mid year is a good time to give your retirement plan the once-over to ensure you’re taking full advantage of all your savings and investment opportunities. If any changes are in order, you still have the rest of the year make a plan, boost your contributions, rebalance your investments, find streams of income and more.

Take some time this July to get on track with your retirement plans. Speak with your trusted financial advisor or retirement planner to help you create a comprehensive safety net for your golden years, using a comprehensive view of your financial situation.

Strategies for Creating or Reviewing a Retirement Plan

Catch up with your retirement contributions, cut your tax liability, fine tune the performance of your investment portfolio, save more and improve your chances for a bright future. Here are a few strategies for giving your retirement plans a thorough check up:

Set or Adjust Your Contributions

2018 Maximum Annual Salary Deferral Contributions

Retirement Account Contribution Limit Catch-Up Contribution Limit
401 (k), 403(b) and 457 $18,500 $6,000
SIMPLE IRA $12,000 $3,000
SEP IRA 20% of net income(or 25% of compensation) up to $55,000 None
Individual 401(k) 20% of net income(or 25% of compensation) plus $18,500, up to $55,000 $6,000
Traditional IRA and Roth IRA $5,500 $1,000

Employer-sponsored retirement plan
If you have retirement benefits through your employer, you can contribute money to an account or mutual fund which decreases your taxable income; these are called annual salary deferral contributions. You may also qualify for the Saver’s Credit for contributing to your plan. Many employer plans allow you to make contributions anytime, however some only allow you to make contributions mid year under certain circumstances. You may want to max out your contributions to cut your pre-tax income level or you may want to follow a guide set by your financial advisor. Review your contribution rate and adjust accordingly.

Individual Retirement Arrangements (IRAs)
You may also want to make tax-deferred contributions to an individual retirement account. Some factors may limit your ability to contribute to an IRA or deduct it from your taxable income. For example, your age, adjusted gross income, filing status, whether you or your spouse were covered for any part of the year by an employer retirement plan and more – speak with your tax accountant or visit for details.

Note: Does the IRS Recognize Your Same-Sex Marriage? Generally, safe harbor 401(k) and 403(m) plan provisions must be adopted before the beginning of the plan year and can only be amended in very limited circumstances. IRS in Notice 2014-37 is allowing those retirement plans, including 403(b) plans, to make midyear amendments to reflect the U.S. Supreme Court’s Windsor decision allowing same-sex couples (who were legally married in jurisdictions that recognize their marriage) to be treated as married for federal tax purposes.

Review Your Investment Portfolio

Your retirement plan likely involves some mixture of stocks or fund investments. Depending on how the markets and your picks performed for the year, it may be time to reassess your risk tolerance, change up your picks and harvest extra cash to reach your investment goals this year. Some employer plans allow investors to manually rebalance themselves or set targets to do it automatically (target date retirement funds), ask your benefits manager for details.

  • Assess Current Risk Levels: Is your risk tolerance the same as it was at the beginning of this year or even when you began your account? If you can’t sleep at night because you’re worrying about making ends meet, then you’re probably taking on too much risk. In addition, if you are a few years from retirement, you may want to consider avoiding risky calls that could jeopardize your savings. Be honest about what you can handle as an investor.
  • Adjust Asset Allocations: Review your account every so often to make sure allocations match their original targets for a good mixture of common stock, preferred stock, bonds, real estate, etc. (the right mixture will be one decided upon by you and your trusted advisor). If the proportion of assets you have in stocks outperformed your other asset groups, then your portfolio may be riskier than it was designed to be. Check your investment statements and buy, sell or trade to rebalance your portfolio.
  • Harvest Gains or Losses: As you rebalance, you may want to to lock in some gains or call up last years losses to offset a taxable gain. Then, reallocate your portfolio into something that could handle the volatility better.

Locate Other Streams of Retirement Income

Aside from your employer or individual retirement savings and investments, you and your advisor will want to continuously review options for generating income after retirement. Perhaps you want to purchase a rental property or use a cash-value life insurance policy to start a business.

Address Your Long-Term Care Needs

The cost of health-care is rising and retirees are living longer and it’s likely your savings or investments are not enough to cover your expenses for nursing homes and medical care in the future. Avoid depleting your retirement assets at a much faster rate by purchasing some form of long-term care insurance if you haven’t already done so. Consider using income from a specific portfolio to offset the cost of premiums.

Keep Beneficiaries and Important Documents Up-to-Date

Finally, don’t forget to keep your legal documents and beneficiary designations up to date. By law, your spouse is the primary beneficiary of your retirement plan account (unless they consent to allowing other primary beneficiaries). These beneficiary designations supersede the demands of your will; so if you have had any changes to your family structure – such as a marriage, divorce, or new child – update your documents now.

Be an Active Participant in Your Retirement Plans

Saving for retirement requires planning! That is why you should periodically review your retirement savings goals, investments, savings options and annual contributions. Maximize your retirement plans to cut your tax liability this year while putting you in position to have the life and care you need for the long road ahead.

Remember to speak with your financial, legal or tax professional for more information about the topics which interest you.

Take the next step - Let's talk!

Remember to speak with your financial, legal or tax professional for more information about the topics which interest you. Here are a few ways for you to share your ideas, learn more and interact with FinancialSafetyNet members, authors and expert advisors.
Have a question, but don't want to share it with everyone? Contact a financial advisor.
Want to contribute to the conversation publicly? Submit a comment.

Submit A Comment

About Harold Goldman

I am the founder of, and a Retirement Planning and Long-Term Care specialist. I am also the President of Emes Insurance Services, Inc., a Murrieta based insurance agency designed to help people with Retirement Planning and funding for College. I believe in educating my clients to become financially competent in an effort to develop plans for guaranteed income, protection against loss and tax-advantaged growth. To contact me Call (844)-376-2265

You must be logged in to post a comment Login

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.