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Important Update: Changes in FDIC Deposit Insurance Coverage

The FDIC deposit insurance rules have undergone a series of changes starting in the fall of 2008. As a result, certain previously published information related to FDIC insurance coverage may not reflect the current rules. For details about the changes, visit Changes in FDIC Deposit Insurance Coverage. For more information about FDIC insurance, go to www.fdic.gov/deposit/deposits/index.html or call toll-free 1-877-ASK-FDIC (1-877-275-3342). For the hearing-impaired, the number is 1-800-925-4618.

Fall 2011

Retirement Planning and Saving: Basic Strategies for Achieving Your Goals

1. Figure out how much money you will need to save for retirement. Start by contacting the Social Security Administration at 1-800-772-1213 or going to www.socialsecurity.gov/estimator to learn what your monthly Social Security benefit would be when you plan to retire. Remember, if you retire before your "full" retirement age (available at that same Web site), your benefits will be reduced. Then use an online calculator (offered by many banks and other organizations) to estimate how much you need to save each month or consider talking to an advisor, perhaps a financial planner (visit www.sec.gov/answers/finplan.htm on the Securities and Exchange Commission Web site).

2. Take advantage of retirement savings programs at work, especially those involving matching contributions from your employer. "If your employer has a program to help you save for retirement, sign up and contribute — and in particular, save as much as you need to get the full amount of any match the employer may offer," said Luke W. Reynolds, Chief of the FDIC's Outreach and Program Development Section. "And if your contributions are tax-deductible, the money you save in taxes means your take-home pay may not drop much."

3. Make sure your investments are diversified. "Understand that if you're starting out in your career you can generally afford to take more risks with your investments than if you're closer to retirement, when you need to be concerned about losses that could delay or jeopardize your plans to retire," Reynolds added.

4. Explore IRAs (Individual Retirement Accounts) and other programs that can help you achieve financial goals and save on taxes. In particular, self-employed individuals and others not covered by a traditional retirement plan at work should explore these options.

5. Cut back on unnecessary expenses so you have more money for retirement savings. For example, pay off most or all of your credit card balances and other loans to save on interest and avoid having to make these payments during your retirement years. Also, think carefully before purchasing any investment, including a variable annuity, that comes with high fees or penalties if you withdraw money early.

6. Be on guard against retirement investment scams. Walk away from solicitations that "guarantee" consistently high returns or that otherwise sound too good to be true — especially from a stranger or anyone who pressures you to quickly say "yes" to an offer. If the seller runs off with your money, that can seriously impair your retirement years. For additional guidance, see the U.S. Securities and Exchange Commission Web page "Avoiding Retirement Frauds" at www.investor.gov/employment-retirement/retirement/avoid-retirement-fraud.

To learn more, see More About Retirement Savings.

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Last Updated 11/28/2011