Today, however, if someone says, ‘I have a pension,’ that usually means they work in the public sector. Public employees make up 14% of the total workforce. Fifty-two percent of them have college degrees, which is higher than in the private sector, where only 35% do.
Your school system provides you with a list of 403(b) companies. The 457 plan is different. The city/town usually provides one company. Both typically give you a broad range of investment options.
SEPs are supercharged IRAs, following the same rules but allowing for higher contributions. In 2020, the self-employed can contribute the lesser of (a) $57,000 or (b) 20% of their net adjusted income (gross income from self-employment minus expenses and half of one’s self-employment tax).
Because the stock market is significantly overvalued at this time, now is an excellent time to consider rebalancing your portfolio. By rebalancing instead of selling what has gone down or buying what has gone up, investors remain diversified but go back to their original allocation. So while diversification is about the eggs, asset allocation is about the basket. What percentage of your basket is going to be in stocks and bonds?