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Basics Of Retirement Planning |
Have You Considered Saving Bonds For Retirement?
| You may already
participate in a 401(k) or other similar thrift
plan. It's wise to make use of these plans, designed
primarily for retirement. These plans, however,
usually have some heavy-duty restrictions or
penalties if you pull your money out early. Savings
bonds can be used before retirement, if necessary,
helping to protect your retirement investments.
Bonds can also supplement your other retirement
savings.
There are a couple ways you can use bonds to save
for your retirement. One way is to start saving
regularly today and defer paying taxes on the
interest that your bonds earn. After retirement, you
can cash bonds to supplement your retirement income
and report the tax-deferred interest as income at
that time (when you might be in a lower income tax
bracket).
Another way you can add to your regular
retirement income is to exchange your E/EE bonds for
Series HH bonds. The HH bonds will pay you interest
semiannually for up to 20 years. You can continue to
defer paying taxes on the EE/E bonds that you
exchange although the interest you receive on the HH
bonds is taxable in the year it's paid.
See also:
Investing In U.S. Saving Bonds |
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