Mechanics of Investing: A Lazy Man’s Guide I

This is going to be a 2-part series. In this first part, I’ll talk about the basics of common retirement accounts and in the second part, I’ll discuss investment choices. As always, I’ll try to keep it simple and easy to follow. One of the greatest concern for most people when it comes to investing is the ability to defer withdrawing their money until retirement. Now, retirement is at different ages for different people. Most people in America consider retirement age to be age 65, which is also the age when one qualifies for Medicare. Most newly settled immigrants to America cannot come to terms with this because for most tax-deferred retirement plans, if you attempt to withdraw your money early (typically before age 59.5 years), you will incur a penalty (typically 10%). The government puts this penalty for a good reason: so you don’t liquidate your nest egg even before you get to your retirement. It’s like helping to

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