Aspiring Nirvana

Is investing in 401(k) a good idea for Retirement?

A 401k is a retirement plan offered by companies in which the employees contribute part of their salary with employers usually offering matching contribution.

Introduction A 401k is a retirement plan offered by companies to their employees. Employees can contribute part of their salary to the plan, invest in various mutual funds, and let it grow tax-free until withdrawal time. Contributions to 401k are tax-free (up to an annual limit) which will lower your taxes. On top of that, most companies provide matching contribution.

Pros

401k money grows tax-free until withdraw time post retirement, thus providing better returns compared to taxable account
Employer matching contributions are like free money
Contributions are automatically deducted from your salary
You will probably be in a lower tax bracket when you take money out during retirement

Cons

The 401k plan investment choices may have mutual funds with high fees
You will eventually pay taxes when you take the money out
There are early withdrawal penalties if money is taken out before retirement

I am not sure if I can save part of my salary

What if your employers offers you a 5% raise. Will you ever say No? Never!

That is effectively you are doing by not contributing part of your salary to 401k, assuming your employer matches your contribution. Even if there is no matching, you are still saving money on taxes while securing your retirement.

I am afraid of losing money in stock market

It is a valid concern! Although no one can predict the future, US stock market has always bounced back after every crash.

Money invested in 401k is for the long-term retirement purpose. There will be short-turn bumps but if you stay the course and not panic, then you will come out a winner in the end.

Additionally, there are various strategies (Ex. Dollar cost averaging) to overcome unique risks to your situation that allows you to invest money in higher or lower risk options.

What happens to my money if I change jobs

When you change your job, you can:

(1) Rollover money from previous employer plan to new employer 401k plan

(2) Rollover money to IRA (Individual Retirement Plan)

Remember, 401k money belongs to you! You have full control over what to do if you change your job.

Action Items to start 401K

Decide what percentage of your salary you can contribute to your 401k
1. At a minimum, contribute to take full advantage of your company matching
Work with your company HR to set up your 401k Account
Select which mutual funds to invest in
1. Start by investing in target-date funds as they choose allocation per your retirement age
2. As you get comfortable, you may want to invest in a mix of Index Funds and Bond Funds
Set up to automatically deduct money from you salary

That’s it! Sit back, relax and watch your money grow over time!

Final Verdict

For salaried people, contributing money to 401k account is one of the best way to save for retirement, get free-money from employers, reduce taxes and comfortably save for retirement.

The key is to start early, contribute regularly and let your money grow over time!

We hope the information in this post will be helpful in your journey of aspiring nirvana!

How to Save Money on Prescription Drugs

The high cost of prescription drugs these days can wreak havoc on your budget, even if you have medical insurance. However, it doesn’t have to be that way. There are several options that you can use to save money on prescription drugs.

Generic drugs have the same ingredients as the brand name drugs. On top of that, generics are less expensive. Ask your physician about generic version of the prescribed drug. If generic is not available then ask if there is cheaper version available.

Larger Supply Every prescription refill may cost you an insurance copay. So, you may be able to save money if you can get prescription for larger quantity. Plus, it will also save you time on driving to pharmacy.

Shop Around Drug prices varies between pharmacies for various reasons. Additionally, big-box retailers and grocery stores may also offer lower prices. Make sure to check and compare prices at different locations before ordering.

Coupons Always check if there is any discount coupon from the manufacturer. Following sites and mobile apps can help you in finding discount and compare prices at close-by pharmacies:

Mail Order Services Ordering medications via mail through pharmacy may lower your cost. On top of that you can save time and gas money by skipping multiple trips to the pharmacy. Be careful to check that the pharmacy is licensed and meets your insurance company requirements.

Manufacturer Rebates Some manufacturers offers rebates for banded drugs, think of these as coupons. They may also offer cards to the insureds that will lower the cost of brand name drugs.

Health Saving Account or Flexible Spending Account Check if your employer offers HSA or FSA programs. Using these programs, you can pay for your medicine using pre-tax money deducted from your paycheck. These programs will not lower the cost, but will reduce your taxable income.

Financial Assistance For financially needy people, who don’t have health insurance, there are multiple types of assistance programs offered by various entities. Check the eligibility criteria of these programs to ensure that you qualify. Some of these programs are:

Final Verdict High cost of prescription drugs may ruin your budget. The choices listed in this post may help you in lowering the price. However, it is up to you to decide which choice will work best for your needs.

We hope the information in this post will be helpful in your journey of aspiring nirvana!

Dare to Walk in the Seabed with World’s Highest Tides – Hopewell Rocks Park

If you aspire to walk on the ocean floor and few hours later kayak at the same spot with 50 feet high tides, then you must visit Hopewell Rocks, home to the highest tidal range in the world!

Hopewell Rocks Park, Bay of Fundy, New Brunswick, Canada

The Hopewell Rocks Park is one of the Marine Wonders of the World. The rocks at the park are between 40 to 70 feet tall, with unique formations caused by daily tidal flows of up to 50 feet, containing 175 billion tons of sea water flowing in and out daily! The time difference between a high tide and a low tide is about 6 hours.

The Hopewell Rocks Park is located at the coast of the Bay of Fundy, at province of New Brunswick and close to Nova Scotia, Canada. The Bay of Fundy itself is one of the 7 natural wonders of America.

On the way back from Nova Scotia, we stopped at the town of Mocton, New Brunswick. From there we headed to the Hopewell Rocks park which was about half-hour drive. When we reached at the park it was time of low tide, so we took stair to reach “ocean floor”. We strolled at the sea bottom along the base of rocks and admired their unique shapes and enormous size.

A word of advice based on our personal experience. Remember, you will be walking on a wet and muddy ocean floor, so dress appropriately with proper footwear or walk barefoot. There will be water facility to clean your footwear near the stairs.

The base of rocks have been eroded over the years by tides. The rocks harbor diverse sandstone forms and their tops are usually covered with trees. Usually the difference in tides is just few feet at other places, but the size of Bay of Fundy uniquely matches gravitational force of the moon push pull cycle, that results in high tidal waves at Hopewell Rocks.

We strolled through the area while admiring the unique geology on the ocean floor. After few hours, the tide started reversing and ocean water started tricking in. We safely moved above the shore using the stairs and watched as the area below started submerging in ocean water again.

This image has an empty alt attribute; its file name is Hopewell-Rocks-Boats-1024x563.jpg — Hopewell Rocks, High Tide

Having watched one of the unique natural wonder of the world, it was time to bid goodbye! Before heading back home, we paused and admired one more time, the complex and unique geological landscape on Earth!

Our rating: 4.5*s out of 5

This concluded our week-long trip to Canada provinces New Brunswick and Nova Scotia .

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