Are You Thinking of the Future?

Filed in archive Latin Issues on August 1, 2008

© bandita


I was reading in the paper this morning that one in four people of Latin American heritage make early withdrawals from their retirement accounts.

Experts say it's due to the poor economic situation we're going through. The most common situation is when a person switches jobs and takes a check instead of rolling their 401K over to some other retirement account.

People just cash out and start a new 401K wherever they land. But by doing this, you have taxes to pay and a penalty of roughly 10% for early withdrawal... and worse, the money taken out doesn't have a chance to grow.

Experts are concerned and remind us to leave that money for the future, taking it out only under the most urgent circumstances. There are more and more people in that over 65 population. We live longer, so we need to make sure to plan for those extended golden years.

As with so many things, education is key.

Survey revealed that 43 % of Hispanics rate their knowledge of investing or savings for retirement as â€"knowing nothing” compared to 12 % for all workers. -NHCOA

It's important that we become more financially savvy to ensure the kind of retirement we dream of.