CNBC: “Does inflation have you worried about retirement? Here’s what experts say to do”

CNBC, May 17, 2022 “Inflation may have you worried about your retirement,” writes Michelle Fox in today’s article for CNBC. “Prices have been rising on everything from food to housing. In April, the consumer price index, which measures the prices of goods and services, notched an 8.3% increase from the year-earlier period.”

When Michelle turned to Marguerita Cheng, CFP® Pro, for insights, Rita said: Keep contributing!

If you aren’t experiencing a reduction in income, continue to contribute to your retirement plan, said certified financial planner Marguerita Cheng, CEO of Blue Ocean Global Wealth in Gaithersburg, Maryland. “With your employer-sponsored plan, you are taking advantage of dollar-cost averaging,” she said. “That means you are investing your money in equal portions at regular intervals, no matter how the market is doing. In essence, it reduces risk but may not generate returns as well as lump-sum investing.”

Rita noted that If you are over age 50 and can take advantage of a Roth 401(k), Roth 403(b), or Roth TSP (thrift savings plan), consider directing catch-up contributions into the account. For 2022, that is a maximum of $6,500. You pay tax on contributions, so you don’t have to pay when you withdraw the money. “Tax diversification is important,” said Cheng, a member of the CNBC Financial Advisor Council. “Building a bucket of tax-free income in retirement is definitely something to consider.”

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