Retirement Planning
It’s never to soon to start thinking about retirement. The average retirement age in the United States is 62 although, some will retire earlier. Many also choose to stay to stay in the workforce longer for fulfillment or financial reasons. The good news is, it’s never to soon to start planning for retirement. Here are a few tips to help you plan ahead.
1. Start Saving
If you are already saving, keep it up! If you haven’t started saving for retirement yet, set up a plan, set goals and stick to it. Even if it’s a small amount at first, you will at least be putting something back.
2.Know Your Retirement Needs
Experts suggest that you will need around 70% – 90% of your preretirement income to live comfortably. One expense you will need to plan for is medical expenses. You are eligible for Medicare starting around 65, so if you retire before then, you will have to plan accordingly.
Also, Medicare doesn’t cover everything so you may also need to look into supplemental insurance. You will also need to figure in cost depending on where and how you want to live in retirement whether you already own a home, plan to live in a retirement community in Florida or a nursing home in Lancaster, PA, the cost can vary greatly.
3. Contribute To A Retirement Plan
If your employer offers a retirement savings plan contribute all you can and figure out how much you will accumulate over time. You can also put money into an Individual Retirement Account and have it deducted directly from your checking or savings account.
4. Don’t Touch Your Retirement Savings
Many people in a pinch decide to borrow from their 401k or savings, but if you withdraw early, you may face a steep penalty and owe taxes on the withdrawal. If possible, try to borrow from other sources before you decide to touch your retirement.
5. Be Realistic
For retirement, you will need a budget and account for things such as the cost of living and medical expenses. Keep in mind expenses all tend to go up. You may need to stay in the workforce longer to acquire the amount of savings you need to live comfortably or put back a larger amount of money for retirement. The good news is that on average people are living longer now and it’s never to soon to think about saving for retirement!
Have you planned for retirement?
