Let's Answer Your Questions About
Retirement
How Much is Enough to Retire?
There’s been a rise in healthcare costs, and it’s a trend that’s likely to continue. There’s also an increase in the cost of living. Necessities like food and housing become more and more expensive each year. Additionally, people on average are living longer. As a result, people have to plan for a longer retirement. Retirement strategies are changing. How can you tell how much is enough to retire? There are strategies you can use to plan for your financial future as effectively as possible.
How Inflation Affects
Your Retirement Strategy
When planning for retirement, inflation is a key factor in determining how much is enough to retire. Each dollar that you save loses its value over time. The basic inflation rate can be calculated. Inflation typically increases by around 2% annually, so you should typically increase your yearly expenses by 2% each year.
An effective retirement strategy involves figuring out how much income you’ll need in the future, factoring in inflation. You need a financial strategy that will provide you with the income you need for the rest of your life. At Safety First Money Group, we can help you determine this by taking into account your unique situation, needs, and goals.
Making a Retirement Budget
Retirement expenses also should be considered when answering “How much is enough to retire?” We talk about our client’s expected expenses in retirement as part of our process. It’s important to get a realistic estimate of how much you’ll need to fund your retirement.
Online budget or cost of living calculators can help you approximate your income and expenses you need to meet. You should factor in your day-to-day expenses, like housing, food, and health care. Also, take into account the “extras,” when you calculate your expenses. For example, You might want to travel more in retirement, pay off your mortgage, or make charitable donations. You could also face an emergency of some sort. Create an emergency fund, to prepare yourself for unanticipated expenses.
Keep Your Retirement Income Safe
In today’s rapidly changing economy, most companies are unable to maintain their pension programs. Government employees must contribute more to their pensions now than they previously did. As retirement approaches, many people discover that their payouts are much lower than expected. Investments like the stock market aren’t ideal. either, due to their high amounts of risk. In the event of a market crash, your income could diminish drastically. Retirement options that provide a secure income may seem like a thing of the past at this point.
For these reasons, protecting your principal is essential in ensuring a secure retirement. We offer a variety of strategies and products, including fixed indexed annuities. Here at Safety First Money Group, our main focus is on protecting your assets, while still getting you a reasonable rate of return**. We can help you create a retirement strategy that you feel confident in. Get in touch with us for a no-cost, no-obligation meeting, or attend one of our educational dinner seminars.