No one likes thinking about getting old, but we do love thinking about retirement. Work has long been at the forefront of our lives, but once retirement hits, it’s time to enjoy the fruits of our labor.
However, although retirement is a positive thing, it does come with a new challenge. Now you’ll need to sit and plan.
If you’re asking yourself, “Can I retire?” take a look at this article for some information you should consider before making that choice.
How Much Money Do You Need in Order to Retire?
For anyone planning to retire, finances are the first thing that needs to get figured out. Since you’re not working, you’ll need to have a large amount of capital to make sure you can live your life comfortably.
The amount of money you need to retire will depend on:
When You Want to Retire
Age plays an important part in retirement because the earlier you retire, the more money you’ll need to have saved. Retiring at 55 will be completely different than retiring at 65.
How Much Money You Have Currently Saved
If you’re considering retirement, take a look at the amount of savings you currently have.
Let’s say you have at least six figures saved up at age 60; will that be enough to cover you until retirement benefits kick in?
Access to Social Security Benefits
Speaking of retirement benefits, depending on your DOB, you’ll need to figure out when they’ll be accessible to you. If you were born between 1943 and 1960, your retirement age is 66.
For anyone born after that, your retirement age is 67. You can get early retirement benefits starting from 62, but you’ll need to meet specific criteria, and the government will reduce them.
Projected Life Span
Unfortunately, no one knows how long they’re going to live. Anything can happen, so you need to plan as if you’ll be living forever.
To get a rough estimate for how long you’ll live after retirement, use a life expectancy calculator. It’s not meant to scare you but instead, help you figure out your retirement finances.
How Can I Retire Comfortably?
Do you know what age you want to retire? If you’re thinking about retiring by age 62, you’ll need to start saving by the age of 25. If you’re thinking about retiring at 65, you’ll need to start saving by 35.
You should put about 15% of your pre-tax salary towards your retirement savings. That way, by the time your social security benefits kick in, you’ll have a solid amount of capital.
You can also open up an IRA custodian account to gain some passive income during your retirement.
Consider These Tips Before Retirement
The next time you ask yourself, “When can I retire?” look at your current position. Consider the tips above and ensure that everything is in order. If it is, then you’re well on your way to enjoying a fulfilling retirement.
Hopefully, this article has been insightful. If it has, please check out our other blogs for related content.