The promise of work-free days in retirement motivates millions of people to push themselves as hard as they can early in their careers so that they can kick up their feet in their later years. While the typical workload has arguably grown over the past decades, the average person today retires later in life than generations before them. This may be because many of us are staying healthy and active for longer, which enables us to work more than in the past. On the other hand, many would-be retirees are postponing their retirement for financial reasons: they are discovering that they aren’t as financially prepared for retirement as they thought.
Reduce the chances of your needing to postpone your retirement plans by giving yourself an adequate window of time to save. Unsure how often you need to save, or how much? Consider these three ways that will boost the likelihood you’ll retire comfortably and on-time:
How Much Is Enough?: In order to determine how large your retirement nest egg should be, do some research. If you know the type of lifestyle you would like, including where you would like to live, try a retirement-planning exercise. Make a hypothetical budget for a month based on the expense of living in a particular area. Expand your monthly budget into an annual one and multiply that figure by how many years you expect to be in retirement. Don’t forget to consider how inflation will likely raise prices in the future. And also include expenses like medical costs and even money for vacations.
Assess Your Savings Pace: Determine how much you can spare for retirement savings out of your current budget. If you expect to retire by 65, for example, would your current savings rate cover your estimated retirement expenses once you reached your sixty-fifth birthday? If the answer is no, you still have several ways to retire on-time. Options include creating a savings plan, pushing your goals higher and increasing your savings power and income, which leads to the next tip.
Consider a Second Career: An increasing number of people are improving their financial standing by finding an additional source of income. Not only can a second career help you reach your savings goals, it may also transition into a means of keeping yourself busy and secure when you retire from your primary career.
Want more information about retirement? Visit the Syncis blog at syncis.com/blog.