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Chapter 5. Developing Your Retirement Plan > Pulling It All Together - Pg. 64

Developing Your Retirement Plan 64 No matter what type of IRAs you choose or how many you have, the most that can go in each year is set by the IRS. In 2001 it's $2,000, but beginning in 2002 the new $3,000 limit will increase, so by 2008 you'll be able to set aside $5,000. And by 2008, if you're age 50 or older you can save an additional $1,000 each year. Double these amounts if you're married. So if you need to save more, check out your options in Figure 5.15 and read Part 3, "Mastering the Basics of 401(k) Investing," on investing before making decisions. Pulling It All Together No plan would be complete without a dose of reality. Things change! Because things never stay put, you need to monitor your plan (we suggest every two years or when a "major event" happens). You also need to ask yourself some important questions about the future: · What is the probability that I will continue working for the same company over the next 10, 20, or 30 years? · What return can I expect from investments? · How will inflation affect me in the years ahead? · What life events could cause me to divert resources away from my goal(s)? · How will medical expenses in retirement impact my savings? The Least You Need to Know · Everyone needs a plan; if you don't have one, you don't know where you're going and you're likely to end up somewhere else. · Calculate how much money you'll need to live after retirement.