Have you thought about or updated your retirement plan recently?
Part of retirement planning means to devise a roadmap to care for yourself and your family after you are no longer earning a regular salary. It affects not only your current lifestyle but your future lifestyle as well. You may think that you have plenty of time to plan for the future. After all, you are young. And, besides, you have many career advancements and salary increases ahead of you.
Is like planning a dream vacation, you must decide where you are going to go, how you are going to get there, what accommodations and provisions you might need, and what safety precautions you are going to take. With retirement planning, you decide:
Where you want to be at the age you want to retire,
How much money you need to set aside,
What type of investments to make to reach your goals, and
There is not one master plan suitable for everyone. Individuals have their own ideas about what is an acceptable lifestyle.
Consequently, there are as many plans as there are people. Plans and ideas may be similar but seldom are they exactly the same.
How to protect your investments so they are there for you when you retire.
Why Is It Important to Start Planning Now?
It's important to maintain an established lifestyle after retirement. After all, would you like working your whole life to provide for yourself and your family, just to find out that when you retire you could not support yourself? It's important to:
Be prepared for uncertain economic times. In today's business world, there is no such thing as job security.
Have additional income to supplement social security.
The Social Security system was never designed to provide all of an individual's retirement income.
And in the future, social security benefits (amount, taxability and present value) may be uncertain.
By saving now, it allows you to make smaller annual monetary contributions to reach the same goals.
For example, if you have 40 years to save, and you want to save $1.1 million.
If you wait 10 years to begin saving, it would take $6,727 a year to reach the same goal of $1.1 million.
Now is the time to decide how you want to live in the future.
Effective retirement planning begins early.