Retirement Planning: A Checklist for Older Workers
From: thealertinvestor.com
Worried that you don’t have enough saved for retirement? You’re not alone.
A recent Gallup survey found that Americans list retirement savings as their top financial concern, with 64 percent saying they were “very worried” or “moderately worried” about having enough money to support themselves in their golden years.
Experts often advise young people to start their retirement savings early in their careers, but those who are closer to retirement can take important steps to shore up their finances as well. If you’re a few years away from retirement, here are some key moves you should consider to secure your financial future.
Decide the actual age of your retirement: It’s easier to plan for retirement when you know your timeline. While 65 may be the typical retirement age, some workers choose to retire at other ages that coincide with the availability of specific benefits and income streams. For instance, those who retire at a younger age may do so in part because 401(k) and IRA savers can start withdrawing from their retirement plans at age 59 1/2 without facing a tax penalty. Those who wait until they’re older, meanwhile, might be motivated by the fact that waiting until age 70 to claim Social Security benefits will leave you eligible for increased benefits. Plus, those extra years can be an important time to shore up existing retirement savings plans. The average retirement age in the U.S. is 62 for women and 64 for men, according to The Center for Retirement Research at Boston College.
Estimate your retirement income: Life on a fixed income requires a good deal of planning, but it’s hard to plan if you don’t know how much money you’ll actually have coming in the door each month. To learn roughly how much you can expect to receive in monthly Social Security payments, check out the Social Security Administration’s Retirement Estimator tool. The Financial Industry Regulatory Authority’s Retirement Calculator and AARP’s Retirement Calculator can also be good tools to help you estimate how much you need to save annually to meet a specific retirement income goal. These calculators take into account other sources of retirement income beyond Social Security.
Ramp up your savings: Many who use online retirement calculator tools are disappointed to learn that they have too little saved. Experts recommend that your retirement savings total an amount equivalent to about 8 to 11 times your annual salary, yet 62 percent of working households age 55 to 64 have retirement savings that are equal to less than one year of their annual income, according to research by the National Institute on Retirement Security.
