Filling in the Retirement Gaps
Wednesday, February 09, 2011
You’ve probably seen the commercials where people are walking around carrying their retirement numbers – typically something in the high millions. That’s not too scary, right? The bottom line is you don’t necessarily need $3 million dollars to retire. You need enough money to satisfy what YOU spend on a yearly basis. That’s another reason it makes sense to figure out your current budget and then adjust it for retirement. Will your mortgage be paid off? Will you want to spend more on vacations and travel? Is it possible that the 30 year old you’ve been supporting will meet the financially independent mate of your dreams?
Those currently retired get a little more than of third of their retirement income for Social Security. As you may have heard, this entitlement is in a little bit of trouble. You’ll hear people say, “Don’t count on Social Security”. The truth is you probably can count on Social Security in a reduced payout structure and starting a few years later.
Defined benefit pensions are on the way out, so this will be less of a factor for those retiring in the distant future. The number of large companies offering them has dwindled precipitously over the last few years as companies are moving to defined contribution plans. Those receiving government pensions should also be ready for a serious overhaul.
Retirement Plans and Outside Accounts
So, whether you’re 35 or 65, you should be able to project all of thee numbers to give you an idea of what you’ll need to generate in retirement income. Then it’s just a matter of perfecting that golf swing.
- Fixing the 403(b) Mess
- Is Your Company Using Automatic 401(k) Enrollment?
- Should you still have a 401k Plan?
- Making the Case for Real Estate