Times are tough. People are losing their jobs. Businesses are closing down and that’s precisely the reason you shouldn’t pull your money from your retirement accounts.
Pulling out your money early might mean a penalty.
Under the new federal rules, the 10% penalty for tapping your retirement account before you turn age 59 1/2 is waived for distributions up to $100,000. While this money is still considered income for 2020, you’re allowed three years to either pay the taxes or avoid taxes by fully restoring the funds into your retirement account. You’ll still have to file an amended tax return, and you must be considered a qualified individual under the CARES Act to make this move.
In addition, an early withdrawal will destroy the benefits of compounded growth of your investments over the years. So before you take out your money from your retirement fund, ask yourself the following questions:
Number 1- have you reexamined your finances? Are you only spending on what are necessary to fit your expenses versus your current disposable income, instead of insisting on keeping your lifestyle?
Number 2- Have you exhausted federal programs? If you pull out your money from your retirement account, you may get disqualified from existing federal assistance programs.
Number 3- Are you sure how the current pandemic will affect our economy in the long run and how that will affect your retirement investment? Economists and business leaders are all saying the same thing. The economic effects of the current pandemic will be felt for years to come. Shaving your retirement fund now offers no guarantee you can replenish it soon enough before your retirement. The economy certainly offers no guarantee it will get back into a position that will enable employees to get back into the workforce soon enough.
Number 4- Do you really know what your financial circumstances will be in the next 12 months? 3 years? Five? Retirement funds don’t replenish themselves. If you pull out your money now, more critical needs may come up and you won’t have a back up.
Number 5- How will this affect your taxes? The rule of thumb: Pulling out a long-term investment to pay off short-term expenses is never a good money management principle.
What you need to do is re-examine how you are making your investment and re-examine your short-term needs.
First step is to cancel subscription services, trimming entertainment and vacation expenses, and delaying charitable donations to when you can afford to give again.
Second step is to invest on safe haven investments such as gold, silver, palladium, and platinum. Metals are the only investments that have increased in value in every economic downturn. That’s why central banks, private funds, and billionaires are shifting their investments to gold. Bank of America predicted that gold will reach $3000 in 18 months.
If you want to continue earning even during this difficult time, invest in gold.
If you want to know how you can invest in gold now, call us for a no pressure consultation at (877) 646-5347. You can also visit our website, www.NobleGoldInvestment.com. Again, that’s www.NobleGoldInvestment.com or call us at (877) 646-5347.