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This is a great article on retirement planning at any age from Newsday.com.

Never too late — or early — for retirement planning
By: Gary Dymiski

Confused about pumping money into a retirement plan? How much? Equities or bonds? Regardless of age, successful retirement investing can be accomplished by considering a few critical factors, especially time, say Long Island experts.

“Young people have the best asset of all — time,” said Ed Slott, a certified public accountant in Rockville Centre. “There is no greater moneymaking asset than time.”

Other factors include determining risk and the rate of return a person needs to retire on, said Michael Kresh, president of M.D. Kresh Financial Services in Islandia.

Regardless of age, Slott said, investors should put away the maximum for retirement. Kresh agreed, and added that young investors often can afford to be aggressive “because time is on their side.”

Determining how much risk an investor can afford is an individual thing, experts said, as is rate of return needed for retirement.

Like Slott and Kresh, Ellen Douglas, a certified financial planner and owner of Roslyn-based Fiscal Wizard, has clients who have been pumping money into their individual retirement accounts and other retirement funds since as early as January, when the market was down.

Many of Douglas’ clients have gotten returns of 30 percent, she said, by dollar averaging, or investing fixed amounts over a defined period of time.

“I told my clients they don’t have to dive into the pool head first,” Douglas said. “I like for them to get in slowly, dipping in one foot at a time.”

Slott and Douglas advise investing in a Roth IRA, which pays investors tax-free upon withdrawal. Kresh said diversification is important, too. Younger investors can put up to 80 percent in mutual funds that buy U.S. equities or global equities.

Here are some saving and investing strategies for all age groups.

These investors can afford more risk because they have more time. The highest total return is in equities, so a diversification of 80 percent equities and 20 percent bonds is OK.

Buying individual stocks can be very complicated, said Michael Kresh, president of M.D. Kresh Financial Services in Islandia. Money-market funds that diversify for you are a good move.

The 30s and 40s
Laws over the next two years will be advantageous to converting traditional IRAs to Roths, said certified public accountant Ed Slott. “Not paying taxes when you are retired is a good reason to have a Roth IRA.”

Continue putting money into IRAs, said Kresh, even when the market is down. “It’s not as if you are transferring a huge amount at one time.” And don’t be afraid of a down market, he advises. “When the market is down it means there’s a sale.”

Heading into retirement
“Having 80 percent of your retirement money in equities might be a problem,” Kresh said, “because you might not have time to get through a major market correction.” The split should be more like 70 percent equities, 30 percent bonds.

Even in their early 50s, investors still can consider a Roth, Slott said. “Many people feel tax rates will go up,” Slott said. “The only way to beat the increasing tax rates is with a Roth. It might pay to convert, even when you are older.”

Financial planner Ellen Douglas is a proponent of diversification – 25 percent each in equities, real estate investment trusts, bonds and high-cash instruments – once investors reach their mid-50s. REITs, she said, give investors real estate returns without the headaches of taking care of a property.

Continue to identify risk tolerance, Kresh said. “The more risk you can afford means having more in equities,” he said. Having more than half of your funds in bonds at a rate of 2 percent or 3 percent likely will not provide enough annual income.

“People who already are retired should have enough money put away,” Slott said. “If they have more than enough to live on, converting to a Roth for their children and grandchildren might be a good idea.”

Stay diversified. Statistics, says Douglas, indicate people are living longer. “After retirement, money has to last 20 to 25 years,” she said. “That means with a 4 percent annual withdrawal rate a person needs almost $4 million.”