Are You Saving Enough For Retirement?
When it comes to saving for retirement, it can be a challenge to figure out how much you should be saving, if anything. While you may not be able to predict what your retirement income will be like, you can put your best foot forward by starting early.
Are You Saving Enough For Retirement?
To determine the most appropriate amount of savings, you first have to decide on your target retirement age. You need to factor in the amount of money you’ll need to live on once you leave the workforce, as well as any lifestyle expenses you’ll likely have to account for. As you get older, you might be tempted to make drastic lifestyle adjustments in order to keep up with the bills.
Are You Saving Enough For Retirement?
The retirement calculator is a great tool to use in determining how much you should save. It can calculate your retirement savings based on your age, gender, marital status, and other factors. This includes your anticipated retirement income as well as Social Security benefits and any other supplemental pensions or annuities you might receive.
Are You Saving Enough For Retirement?
If you are lucky enough to work for a company that offers a 401(k) plan, you can take advantage of your employer’s matching contribution. However, if you’re not fortunate enough to receive this type of assistance, you should still make sure you’re saving enough. Depending on your savings goals, you might even have to work longer.
Another consideration is the inflation rate. Inflation decreases the buying power of your hard earned money. By re-balancing your portfolio on a regular basis, you can capture some of the market’s growth. For instance, in 2010, the stock market reached an all-time high. This translates into a small boost to your retirement savings.
While there are many other things to consider when determining how much to save for retirement, the most important is figuring out your actual budget. Not only will you have to cut back on certain expenses, you’ll also have to factor in things like health care costs. That’s why you need a good emergency fund. Putting aside at least three to nine months of expenses is a good start.
In addition to your actual budget, you’ll want to make sure you save the most efficient way possible. Thankfully, there are several financial experts who can help you along the way. They can also recommend a suitable retirement plan for you and your family. From there, you can start saving, saving, and more saving.
Are You Saving Enough For Retirement?
The right mix of long-term and short-term investments can ensure you have the financial security you need when you retire. A good rule of thumb is to save at least 15% of your pre-tax earnings each year. There are even robo-advisors such as Vanguard that can do it all for you. These tools are a great way to save while keeping up with the market. Ideally, you’ll have a mixture of stocks, bonds, and cash.
To help you figure out how much you should be saving for retirement, you can try using one of the many online calculators that will let you see just how much you need to save.