Whether you have been working for 3 years or 30, it is important to have a retirement plan in place. Unfortunately, many people have never taken the time to create a realistic estimate of what kind of savings they will need to enjoy the lifestyle they want during retirement years. Here are a few key factors that influence how much you should be saving to ensure that you can retire comfortably on schedule.
- How long will you be retired? Advances in modern medicine have increased life expectancy over the past decades. Depending on your health and family history, you may want to plan as though you will live to 100 and estimate your needs accordingly.
- What do you plan to do during retirement? If you are planning to travel more, visit family members more frequently, or embrace a hobby, you may have increased living expenses compared to your working years.
- What other expenses will change? Your commute, work clothes, and business lunches may stop, but you may have higher costs for medical care and prescriptions. Talk with our financial planner about the types of changes to your budget that are likely to occur during retirement.
- How much are you currently saving? When you meet with our financial planner, you will review the details of your current retirement savings plans and how your portfolio is performing. During retirement, it may be beneficial to continue some of your investments to help your savings outpace inflation.
- Do you have a withdrawal strategy? If you are an owner or partner in your business, is there a written agreement for buying you out when you retire? Do you plan to transition by working part time for a year or more or should you stop all at once? How are your retirement savings affected by taxes? All these and more should be part of your strategic plan for retirement. Our financial planning expert can guide you through the details of your withdrawal process.
For more information on planning for your comfortable retirement, contact our office and schedule a financial planning consultation.