When planning your retirement, it is important to remember that money, more than any other factor, will dictate most of your retirement decisions. Your level of financial preparedness for your retirement years will determine when you retire, what type of lifestyle you and your family will enjoy during retirement, and what might be left as a legacy to your heirs.
It has been said that no one plans to fail, they simply fail to plan. Nowhere is this idea more applicable than when it comes to meeting our retirement objectives. A sound financial plan can be the difference between meeting your retirement objectives or facing the discouraging surprise of being caught unprepared and with too little time remaining to change your financial course.
At the very least, ongoing retirement planning will help you understand the financial demands of retirement, and help you make those decisions that are best suited to applying limited resources to potentially unlimited demands.
Recent government studies have found that during retirement the average American needs around 80% of their pre-retirement income in order to maintain their standard of living. Almost everyone needs less money during retirement than they do in their working years. How much you need during retirement will be a function of your personal spending habits and goals for your future. Consider the following factors in estimating your retirement income needs:
Once you have estimated your target retirement income, you are ready to begin to evaluate what sources of income will be available to you to meet your monthly needs. Generally speaking, your sources of retirement income fall into three categories, which we will discuss below.
There are many ways that proper planning can improve your current retirement outlook. The more time you have to prepare, the more change you can effect in your retirement income. A sound financial plan and ongoing professional advice can help you obtain your retirement objectives.
Material discussed is meant for general illustration and/or informational purposes only and it is not to be construed as tax, legal, or investment advice. Although the information has been gathered from sources believed to be reliable, please note that individual situations can vary therefore, the information should be relied upon when coordinated with individual professional advice.