Planning for Retirement

 

like a 401(k). With the 403(b), your deductible contribu-tions are invested in a tax-sheltered annuity.

"Again, it's crucial to talk to your personnel department. They'll have all the pertinent information, including your investment options and allowable contribution limits.

"I know that I'm nagging, but seeing your personnel departments to learn about the alternatives available to you is one of the most important steps in retirement planning. It's impossible to decide which is the least painful alternative if you don't even know all the alternatives.

"By next month I want each of you to have paid a visit to your personnel department and to have learned what plans are there for the choosing."

"Shouldn't be hard for me," Cathy said with a grin.

"I also want you to do a bit of reading. There are several excellent books that cover saving for retirement. Two that I highly recommend are Jane Bryant Quinn's Making the Most of Your Money and Personal Finance for Dummies by Eric Tyson.

"Today's lesson, combined with a minimal amount of reading and a trip down the hall at your place of work, can make a great difference to your retirement years.

"You see, this stuff is not that tough!" Roy concluded.

"I know we've been here forever, Roy, but I still have one question." I ignored a look from my anxious-to-golf best friend. "You promised earlier that you would comment on the merits of non-deductible IRA contributions. Well?"

"I'm glad you didn't let me forget that. A number of available investments allow you to make non-deductible contributions to a tax-deferred vehicle. In these vehicles, clearly you are receiving only one of the two government incentives associated with those plans we discussed earlier.