Wake Up And Start Planning For Retirement
If your idea of planning for your senior years is playing the lotto, it is time for a reality check. Those years are going to be here before you know it. Here are some retirement planning facts and tips to prime the pump for you.
It’s easy to procrastinate so set up a “painless” payroll deduction for saving.
Experts estimate that you’ll need about 70 percent of your pre-retirement income – lower earners, 90 percent or more – to maintain your standard of living when you stop working. Take charge of your financial future.
Women represent 58 percent of all Social Security beneficiaries age 62 and older and approximately 71 percent of all beneficiaries age 85 and older.
With rapid medical advances and new thinking about U.S. life expectancy, growing longevity in the future may be much longer than is usually assumed. How will you pay for a longer life?
Call the Social Security Administration at 1.800.772.1213 for a free Social Security Statement and find out more about your benefits.
Of the 60 million wage and salaried women working in the United States as of March 2005, just 47 percent participated in a retirement plan. Remember, even small amounts can earn interest and add up over time.
Take inflation into account. A mere 3 percent gain each year can mean you will need nearly twice your salary at 40 to live comfortably at 80.
Financial Planners say that a person needs about 70% of their pre-retirement income to live a comfortable retirement.
For the average worker Social Security replaces only about 40% of pre-retirement income, the balance must come from pensions and savings and investments.
Select a target date for your retirement. Now assume you will need 70 percent of your current salary to live comfortably on that date. How much money will you need for 18 years of retirement and where will it come from?
If your employer offers 401k plans, try to maximize your contribution. This is particularly true if they match your contributions in any way.
The biggest mistake you can make with your employers 401k plan is simple – not participating. Start saving now with pre-tax dollars even if you are only contributing a tiny amount.
Rip up your credit cards and pay off all balances. Once done, use the money you would have paid to credit card companies for your retirement funding.
If you plan to work after your retirement age, keep in mind that you might not be able to. Why? Your health could leave you. If that happens, will you have saved enough money?
Consider using annuities to fund your retirement. They are a decent retirement vehicle, but are great because they allow you to be sure you will receive a check each month for a certain period of time.
If you consider playing the weekly lotto to be your retirement plan, it is time to wake up. Time will pass before you know it and you will have to be ready to retire. Save now or you will seriously regret it when your measly social security check floats in.
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