Will I have Enough Retirement Income When I Retire?
The question “will I have enough retirement income when I retire” is being asked by more and more Americans each day. With the instability of senior social security, retirement travel costing more and more, and retirement savings just not going as far as they used to, it’s a valid question to ask.
How do you make sure your retirement income is enough to allow your retirement to be comfortable? It’s really quite simple – know your retirement income plan.
Being organized and having a plan surrounding your retirement investments, savings, and income will give you the financial confidence you need when dealing with retirement, whether that day is coming next year, or in 20 years. The key is to manage reasonable goals for yourself both now and for retirement.
Goals for Retirement – financial and personal
Financial goals are not the only ones you want to set for yourself during retirement. Different people want different things out of retirement. Some individuals wants and needs might require them to work past the age of 65, while others might start a different job in retirement because they need to stay active! Others might have been saving money for retirement travel since their early 20s!
Because everyone’s needs are different, there can be no set rule about how much money needs in retirement. There are the sayings that people will need 60-80% of the current salary, or that you need only subtract your age from 100 to find what percentage of your retirement investments should go into stocks for retirement.
However, look at the basics YOU need for a rewarding retirement, by first looking at the basics.
Finances for the Basics
Understanding what your basic needs are, and how much you spend on them, is the first step in organizing your retirement income. First, look at:
- Food
- Shelter
- Clothing
- health care
- transportation
- retirement mortgage
Also, if you keep working, account for any income you anticipate. Add costs for travel, hobbies, entertaining, donations and a second home, if that’s something you’ve worked toward attaining. Think about what might happen to your taxes and apply that information accordingly. Although this number won’t be perfect, it’s a good indicator of what your retirement spending habits will be, and what you need to do to attain the proper retirement income to meet your requirements.
Know your Benefits
When you retire your previous employer will send you income in the form of 401k reimbursements, Roth IRA payments, etc. The federal government will also be providing you with senior social security (if you’re lucky. Current young workers are not necessarily guaranteed social security with the market being as volatile as it current is in) and will be able to use your retirement investments like stocks and bonds.
Will that be enough?
Knowing what you will receive through retirement checks before you retire will help you determine if you need to take up a part-time job, or if you need to postpone retirement.
Retirement Investments
If you do not already have savings in a Roth IRA or traditional IRA account, you need to do so now. Understanding and allowing your money can grow is needed in any retirement income plan.
Once you understand your needs and wants for retirement and how your current income plan will work, you are well on your way to understanding all you need for retirement investing and having the proper retirement income.
