Turning Retirement Savings Into Retirement Income
According to a recent study by the General Accountability Office, about 29% of households over the age of 55 have no retirement savings or pension.
And of those that had retirement accounts like 401(k)s, pensions or IRAs, the median account balance in 2013 was just $59,000, according to the Federal Reserve. Then consider that the average retired couple’s medical cost run about $200,000.
These numbers should certainly make you pay attention if you’re planning for your retirement.
The age of employer sponsored pensions left before we got to the 21st Century. And it’s not coming back. So it’s up to you.
The first step you must take to face your future is to see what kind of money you will need by the time you retire. Our retirement savings calculator is the ideal place to start.
Although it’s cliché, the sooner you start putting money aside in your 401(k) and individual retirement accounts (IRAs), the better. Even if you’re unsure of where to deploy the money in the account, it’s better to build up that tax-advantaged cash than put it in a regular savings account.
Don’t get intimidated by all the options.
There are 3 basic IRAs where you start saving. Each works a bit differently, so it’s good to take your time and learn about each of them. The articles below are great places to start your journey.
The toughest thing about your financial journey to retirement is standing at the base of this mountain and seeing no way to get to the top.
Just take it step by step. And you need to take the first step to begin.
Once you have used the retirement savings calculator and you know how much you will need and how long you have to save it, you’re on your way.
Picking the right mix of IRAs and the right blend of investments will take you a long way to your retirement summit.
Sitting down with a quality investment advisor who can guide you in the set up strategy means once you have built your plan, you won’t have to mess with it that much.
Remember, this is a long-term investing strategy, not a trading strategy. It’s all about the power of compounding.
You should be picking stocks and funds that will succeed over the years, not investments that you constantly have to monitor and buy and sell on a moment’s notice.
This is what many people forget about their IRAs. Once you’re built the system, you shouldn't have to mess with it much. Maybe every six months sit down with your investment advisor to see how it’s all doing. Or if you’re doing your own research on the investments in your IRAs, sit down with your statements and do your own review.
And before you know it, you’ll be where you never thought you could get – a well funded and secure retirement.
If you like this article and want to read more about planning for retirement, check these out: