When it comes to average retirement savings, nearly one-third of baby boomers over the age of 55 neglect their retirement planning, typically socking away less than $10,000. Only 22 percent of retirees have nestled $250,000 or more. When you reach retirement age, around age 50, all the major financial responsibilities should be well behind you. Financial analysts predict, by the time retirement rolls around, retirees will require close to $1 million, and it looks like most are insufficiently prepared.
How Much Can You Live On Each Year
The pivotal question is what’s the yearly amount you’re able to withdraw from your retirement savings without incurring the risk of running out of money? For retirees who find themselves behind on their average retirement savings goals, all hope is not lost.
Here are three things you can do that can profoundly impact your future;
1. Supplemental Your 401k Contributions
Even if you’re a late-saver, you can still gain an advantage with catch-up contributions.
2. Downsize because Less is More
In recent years, many property owners experienced a decline in the value of their homes, thus they’re reluctant to sell. Although the value of many homes have not seen a comeback, downsizing to a more affordable home could save thousands of dollars
3. 401K is a painless way to save
The best retirement plans are the 401k, because you can significantly reduce or avoid taxes on your contributions, until you withdraw it. A common blunder is allocating a large portion of retirement 401k shares to company stock. Placing a large portion of your retirement eggs in one basket is not a practical decision. Remember to diversify.
The most serious blunder people make about retirement is neglecting planning. Shockingly, about 1-in-4 savers pre-plan their average retirement savings decisions. Regardless of whether you are retiring soon or far in the future, now is a good time to take inventory of your current financial portfolio.