1. "Why should I save for retirement?"
   Many Americans look forward to their retirement years, which can be a time for traveling, spending time with family, or enjoying a vacation home. To enjoy your retirement to the fullest, you’ll need to have an appropriate level of savings to get you through many years without a steady stream of income.
   Previous generations relied on Social Security and company pensions for their retirement income; however, those sources of revenue have decreased over the last few decades. Now, most Americans save for their retirement in a 401(k) plan, named for the section of the tax code that allows employees to save money on a tax-free basis.

2. "What is an emergency fund and why do I need one?"
   An emergency fund is a savings cushion available to you in the case of a financial emergency. There are many situations where you may need to rely on your emergency fund, including job loss or other reduction of income, health emergencies, automobile repair, and home repairs. If any of these financial emergencies happen to you, an emergency fund can save you from falling into debt.
3. "How should I review my personal savings plan to make sure I’m on track?"
   First review your savings versus your goals. Evaluating your savings strategy is especially important for long-term savings, such as college savings and retirement savings. In addition to the account balances, you should also consider your investment strategy. Adjust your investments to match your savings goals when the target becomes more short-term. If you aren’t sure how much you should be saving, you may want to work with a professional financial planner.
   Next, request free copies of your credit reports and make sure that your credit accurately reflects your situation. Now is the time to correct any errors that may exist. Also, if you have any accurate negative information on your credit report, take the time to figure out how to repair your credit.

4. "What personal legal documents should I have in case of emergency?"
   Having the appropriate and necessary legal documents prepared, just in case of emergency, is important. While having these legal documents completed can sometimes be time-consuming and expensive, these documents are essential for you and your family. They include a will, living will, power of attorney, and health care proxy.
5. "Can I borrow from my 401(k)?"
   If you are like most people, your 401k account represents your largest savings account. When you need to access funds in a personal financial crisis, it’s understandable why you would consider borrowing from your 401(k) account or withdrawing from your 401(k) or IRA. After all, it’s your money. Plus, in the case of a loan, the interest paid goes into your retirement account. Before you tap into your 401(k), you should understand how borrowing works and know your options. Borrowing or withdrawing from your retirement account prematurely should only be done when you have no other options.

© 2017 Money Management International, 14141 Southwest Freeway, Suite 1000, Sugar Land, TX.