Financial well-being March 12, 2015 By
What have you thought about today? Your kids? Grand-kids? Work? The community event you've committed to, a doctor’s appointment you need to schedule, the list of items you need to pick up at the store on your way home? My guess is you spent time focusing on a lot of important things, but whether you are saving enough for retirement wasn't one of them.
Why should you think about your retirement today? Many experts say Social Security will pay 20 to 40 percent of our normal working income when we retire. They also suggest we should be ready to adjust our lifestyle to live on 70 to 80 percent of our working income. What’s wrong with this picture? If our Social Security check represents 40 percent of our working income and we plan to live on 70–80 percent, where’s the extra 30–40 percent going to come from?
That’s what we had better figure out sooner rather than later. It is crucial we plan for retirement through some form of investment—a 401k, self-directed Roth IRA or traditional IRA, mutual funds, rental property, or other investments.
US News has stated that the average American nearing retirement has about $100,000 in retirement savings. A rule of thumb is, you shouldn't pull out more than about 4 percent a year from retirement funds, so that equates to about $4,000.00 or $333.33 a month. Add that to the average Social Security payment for retired workers, $1,300.00, and you get about $1,600.00 a month to live on. Can your family live on that? For many of us, that would be a struggle.
So why don’t people plan for retirement? Do the following excuses sound at all familiar? I’ll do it next year.
- I don’t know where to start.
- It’s pointless anyway.
- It’s too late.
- It’s too early.
- I can’t afford to.
- I’ll wait till I get my home paid off.
Any excuse will do—will do harm, that is. Drop your excuses and make planning for your retirement a priority. Remember, anything saved is better than nothing, and a little over a period time can turn into a lot.
Take action today and learn more about each of the following steps by visiting our Retirement Planning Checklist:
- Reflect on your retirement plans and goals.
- Know where you currently stand on your retirement savings.
- Determine your timing for retiring and receiving Social Security benefits.
- Create a retirement budget.
- Set financial goals for your retirement savings.
- Find new ways to cut expenses and start saving more.
- Plan and prepare for unexpected costs with an emergency savings fund.
- Monitor your retirement savings progress.
The future will come, whether you plan for it or not. But planning for it can make a big difference in what your future looks like.
Review our Retirement Planning Checklist to learn more about the steps above and how to start planning for your retirement.
Know that we’re here to help. Please contact us for guidance and advice. It’s our deep desire to help others spend life wisely, and that certainly includes helping you plan for your retirement.
