The first step toward financial security in retirement is understanding your current financial situation and savings options. Retirement is a significant period in your life which requires a significant bankroll. Whatever your age, finances or savings experience, now is the time to get started. The earlier you start the better off you’ll be when it’s time to retire.
Imagine quitting your job today. How much would you need in your savings, investments, IRAs and retirement plans to support your current lifestyle for the next 20, 30, or even 50 years or more? Add the costs of inflation and health care expenses, and it’s likely a sobering thought.
What will fund your retirement when the time comes? In the past, many retirees depended largely on Social Security and employer pension plans. But future retirees will need to depend more on their own personal savings, IRAs and employee-funded retirement plans to support them during the retirement years. Whether you are age 22 or 52, now is the time to start planning and saving for retirement.
How much will you need? That depends on the answers to some other questions.
At what age would you like to retire?
What kind of lifestyle do you want to have?
Will there be two of you or are you on your own?
Do you own your own home?
How much money will you owe?
Where do you want to spend your retirement?
Will you be in good health?
Although some of these factors are impossible to predict, a rule of thumb is that you will need at least 70% of your pre-retirement income to continue your pre-retirement lifestyle—more if you’re planning to kick it up a notch in retirement. For more information, check out Retirement Central™ . It has calculators to help plan your needs and how much to save, answers to questions about retirement plans, Social Security and Medicare, and things you need to be thinking about at each stage of your life to prepare for a secure retirement.
Have you given your retirement any thought? As always, feel free to contact us or leave questions and comments below!