Introducing SmartPlan-IRA
A convenient way to contribute to a WEAC IRA
March 2000
If you have ever wanted to save money in an IRA, but
couldn’t come up with available funds, you will be pleased to know
that we have now made it easier to start one and contribute to it through
our SmartPlan-IRA. The SmartPlan-IRA is an electronic transfer system
that allows you to contribute monthly to your WEAC IRA account from your
bank, savings and loan, or credit union.
Why use SmartPlan-IRA?
The service is easy to use, convenient, and affordable. With SmartPlan-IRA,
you eliminate traveling to the bank, writing checks, filling out deposit
slips, and waiting for mail delivery. You can use it to make regular investments
in your WEAC IRA, enabling you to make reliable, consistent progress toward
your retirement goals. It is also an affordable way to make current-year
IRA contributions. The service allows you to select the amount ($50 minimum)
you would like transferred from your checking account on the 15th of each
month.
WEAC IRA offers high yield, guaranteed safety and liquidity
If you keep a portion of your retirement savings in more conservative
investments like certificates of deposit (CDs) you will be interested
to know that the WEAC IRA rate has one of the best rates in the nation.
The annual yield for 2000 is 7.0% prior to the deduction of program fees.
Both principal and interest are guaranteed. WEAC IRA funds are more liquid
than bank or credit union CDs because they may be moved to another financial
institution at any time without penalty.
Traditional and Roth IRAs available to you and your family
The WEAC IRA program is open to WEAC members and their families, including
spouses, parents, in-laws, and unmarried children under age 26. Eligible
individuals can choose between a traditional IRA, which offers tax-deferred
growth and possible tax deductibility now, or a Roth IRA, which provides
tax-free growth – meaning no taxes later on.
Both kinds of IRAs are available, and can be funded with rollovers from
other plans or with annual contributions. Our professional staff can help
you decide which IRA makes sense for you.
Learn more about IRAs
Whether it’s visiting about the differences between traditional
and Roth IRAs, or deciding whether to roll a large sum from a former employer’s
retirement plan, a second opinion can provide you with peace of mind.
If you would like more information about the WEAC IRA program or the SmartPlan-IRA
automatic investment option, contact David Mabie, CFP, ChFC toll-free
at 1-877-WMBT-IRA (1-877-962-8472), or via e-mail: dmabie@wmbt.weains.com.
By Jim DiUlio
Retirement Consultant
WEA TSA Trust
We receive many calls at the Trust from members just starting out in
the education field and from those who are a few years away from retirement.
Both groups are in transition – getting ready for a number of earning
years or preparing for the rewards of retirement – and have questions
about how best to plan for the future.
Here are some ideas to get you started. You will want to develop a more
comprehensive plan as you go along.
First five years
- Start a tax-sheltered annuity (TSA) account, even at a nominal $10-$20
per payday. Do not agonize over investment choices. At this point, the
dollar advantage through tax deferral outweighs most investment strategies.
- Learn to live below your means. Pretend you make 5% less than you
do and put that money into a TSA or other savings account. Avoid carrying
balances on your credit cards. Plan to be debt-free by middle age.
- Begin learning about saving and investing. Read financial periodicals,
attend WEAC and WEA TSA Trust seminars, and build a relationship with
your WEA TSA Trust financial consultant.
- Start a simple filing system for your (and your spouse’s) statements
from your state pension and TSA, IRA, 401(k), and other retirement accounts.
Make separate folders for payroll-related things, mortgages, warranties,
tax-deductible items, and your tax returns. Fewer than 10 categories
will do.
With five years until retirement
- Make a list of retirement income sources, and then collect specific
details for each account.
- The Wisconsin Retirement System will calculate your pension benefit
within 12 months of your planned retirement. Call Social Security to
request a copy of your earnings statement and benefit choices.
- Investigate the withdrawal provisions of your TSA and IRA companies.
Discuss the important topic of beneficiary designations.
- Reluctantly admit that you are getting older and look for information
from AARP, NEA, WEAC-Retired, and other organizations.
- Talk to your spouse and family about what you plan to do during retirement.
See if your plans are compatible. Think about how you will spend seven
days a week together.
- Find out what your health insurance costs will be during retirement,
including costs for Medicare supplement insurance. Most people neglect
this area in their financial plans.
- Take some time with resources available at the public library, surf
the Internet, and attend seminars and workshops. Look for retirement-related
information to become a smart consumer.
- Five organizations make up the WEA Insurance Group. These organizations
were created by WEAC to provide high quality, comprehensive insurance
protection for its members and other public education employees.
- Those five organizations are:
- • WEA Insurance Trust
- WEA Insurance Corp.
- WEA Tax Sheltered Annuity Trust
- WEAC Member Benefit Trust
- WEA Property & Casualty Insurance Company
- The board members of these organizations are elected by the WEAC Board.
They are members of the education community and serve without remuneration.
- These organizations offer group plans such as health, dental, life,
long term disability, and long term care insurance. Individual policies
such as automobile, homeowners, renter’s, long-term care and the
WEAC IRA also are available. In addition, they provide members the opportunity
to save for retirement using a tax-sheltered annuity. For more information
about WEA Insurance or any of its services, call toll-free 1-800-279-4000.
Posted February 28, 2000