Are you worried about running out of money in retirement? You’re not alone. A lot of people are concerned about this issue. I know it can be hard to save for retirement, and even harder to make that money last once you’re retired. But it’s not impossible. Here are some tips for avoiding running out of money in retirement.
Tip: Be sure to watch my free training on ‘How to pursue greater wealth in retirement by making ONE simple change to your finances’ by clicking here.
You may be reading this because you’re looking for advice on how to save for retirement. And, while there are many sources of retirement-saving advice out there, I believe that you should listen to me.
Here’s why:
- First, I have almost a decade of experience in the finance industry.
- Second, I’ve helped people save for retirement in a variety of ways – from traditional investment accounts to more complex investment strategies.
- Finally, I’m passionate about helping others work toward their financial goals, including saving for retirement.
So, if you’re looking for tips on how to save for retirement, you can rely on me to provide accurate and helpful information. Thanks for reading!
Key Points
1. Start saving for retirement as early as possible
2. Invest your savings wisely so it will grow over time
3. Review your budget and make changes to accommodate retirement savings
4. Plan for unexpected expenses, like car repairs or medical bills
5. Have a backup plan in case of financial emergencies
6. Make the most of social security and other benefits
7. Make the most of employer & individual retirement accounts
If you want a more detailed breakdown of how to avoid running out of money in retirement, be sure to watch this video.
7 Tips to avoid running out of money in retirement
1. Start saving for retirement as early as possible
Retirement might seem like a long way off, but the sooner you start saving, the better. Retirement planning is all about making your money last, and the earlier you start, the more time your investments have to grow. Not only will you have more time to save up, but you’ll also be able to take advantage of compound interest. Even if you can only save a little bit each month, it will add up over time. So if you’re looking to secure your financial future, make sure to start saving for retirement as soon as possible.
2. Invest your savings wisely so it will grow over time
Many people make the mistake of keeping their savings in a low-interest account, such as a checking or savings account at a bank. While these accounts are great for short-term cash needs, they won’t do much to help your money grow over the long term.
Investing your money is one of the smartest things you can do for your future. When you invest, you’re essentially putting your money into something that has the potential to grow over time. This can be anything from stocks and bonds to real estate or even a small business.
Of course, there are risks involved with any investment. But if you’re smart about it and diversify your investments, you may potentially minimize those risks and maximize your chances for long-term growth.
One of the best ways to get started is to speak with a financial advisor. They can help you understand the different options available and find an investment strategy that meets your needs and goals.
This video explains some of the ways I can help you pursue greater wealth in retirement.
3. Review your budget and make changes to accommodate retirement savings
If you’re like most people, you probably don’t think about your retirement savings very often. It’s easy to forget about putting money away for retirement when you have other immediate financial concerns, like paying off debt or saving for a down payment on a house. However, retirement is something that will eventually happen to all of us, and the sooner you start saving, the better.
One way to make sure you’re staying on track with your retirement savings is to review your budget periodically and make adjustments as necessary.
Determine how much you need to save. A good rule of thumb is to save 10-15% of your income for retirement. However, this may vary depending on your individual circumstances. For example, if you have a pension or other retirement benefits from your employer, you may be able to save less than 10%. On the other hand, if you don’t have any retirement benefits, you may need to save more than 15%.
Saving for retirement may not be at the top of your list of priorities, but it’s important to start sooner rather than later. Reviewing your budget periodically and adjusting as necessary is one way to make sure you’re staying on track with your retirement savings goals. By following the tips in this blog post, you can ensure that you’re taking steps in the right direction when it comes to saving for the future.
4. Plan for unexpected expenses, like car repairs or medical bills
We all know that life is full of surprises. Sometimes those surprises are good, like an unexpected bonus at work or a refund on your taxes. But sometimes they’re not so good, like a flat tire or a trip to the ER. That’s why it’s so important to have an emergency fund—a savings account that you can dip into when life throws you a curveball.
Ideally, your emergency fund should have enough money to cover three to six months’ worth of living expenses. That may seem like a lot but remember—an emergency fund is for big expenses, like a car repair or medical bill, not for small things like coffee or lunch out with friends.
Now that we’ve established why you need an emergency fund, let’s talk about how to start one. The first step is to figure out how much you need to save. A good rule of thumb is to have 3-6 months’ worth of living expenses saved in your emergency fund. Once you know how much you need to save, open a separate savings account specifically for your emergency fund so you’re not tempted to spend the money on other things. Then, start setting aside money each month until you reach your goal. Automating your savings can help make this process easier and ensure that you’re consistently putting money away each month.
Emergencies are never fun, but they happen. That’s why it’s so important to have an emergency fund. Having a cushion of cash set aside specifically for unexpected expenses can help you avoid going into debt or racking up credit card bills. So, if you don’t already have an emergency fund, now is the time to start one!
5. Have a backup plan in case of financial emergencies
Now that you have an emergency fund, does that mean you are done? Not at all! What happens in the emergency is not a short-term setback, what happens if it is long-term or permanent? This could happen from an injury or illness or even death.
Having insurance in place can protect you and your family from financial hardship if something happens to you. Health insurance is a must, as medical costs can be incredibly expensive. Life insurance can help provide financial security to your family should you pass away. Disability insurance can help cover expenses if you’re unable to work due to an injury or illness.
Once you have all the necessary insurance in place it is important to review your coverage once a year, or whenever your financial situation changes (adding more debt, higher standard of living, etc.) to make sure they are up-to-date and cover your needs. A financial advisor will be able to let you know your insurance needs when they are creating a financial plan for you and your family.
To learn more about working with me to help you plan for retirement, click here to watch this video.
6. Make the most of social security
If you’re like most people, you probably don’t think much about your social security benefits until you retire. But the truth is, the sooner you start thinking about social security, the better off you’ll be when it comes time to retire. In this blog post, we’ll take a look at some of the things you can do to make the most of your social security benefits.
One of the most important things you can do to maximize your social security benefits is to know when to start collecting. You can start collecting as early as age 62, but if you wait until your full retirement age (which is currently 66 for people born between 1943 and 1954), you’ll get a bigger benefit. And if you wait even longer to collect, until age 70, you’ll get an even bigger benefit. So, it pays to wait if you can.
If you need the money right away, you may be tempted to take your full social security benefit as soon as you’re eligible. But if you’re married, it may be worth considering taking a partial benefit instead. By taking a partial benefit, your spouse will receive a higher benefit when they start collecting social security.
It’s a good idea to review your social security statement regularly so that you know how much money you can expect to receive in benefits when you retire. You can create an account and view your statement online at www.ssa.gov.
Social security is an important part of most people’s retirement planning. But there’s a lot more to it than just waiting until you’re eligible to collect benefits. By taking steps like knowing when to start collecting and reviewing your statement regularly, you can make sure that you’re getting the most out of your social security benefits. And don’t forget – planning for your future is always a good idea!
7. Make the most of employer & individual retirement accounts
When it comes to saving for retirement, there are both employer-sponsored plans, such as 401(k)s and 403(b)s, and individual options, such as Roth or traditional IRAs. So, which is the best option for you?
The answer may surprise you: both! Employer-sponsored retirement plans and IRAs both have their own set of benefits that can help you save for retirement in the most efficient way possible. Keep reading to learn more about the benefits of employer and individual retirement accounts.
Employer-sponsored plans allow you to deduct the money from your taxable income, which means you will owe less come April 15th.
Another benefit of employer-sponsored retirement plans is that many employers will match a certain percentage of the money you contribute. For example, if your employer offers a 50% match on 401(k) contributions up to 6% of your salary, that means they will contribute 50 cents for every dollar you contribute, up to 6% of your salary. That’s free money that can help you reach your retirement goals even faster!
Traditional and Roth IRAs allow you to save on your own for retirement. This is a great option if your employer does not have a retirement plan or you want to save additional money for retirement, so you can retire faster!
Traditional IRAs, like employer-sponsored plans, allow you to deduct the money from your taxable income, which means you will owe less come April 15th. Roth IRAs don’t allow upfront tax deductions, but your withdrawals will be tax-free (if the money was invested for at least five years).
If you need help with setting this up, click here to watch a video that explains how we can potentially help you.
Conclusion
It is possible to avoid running out of money during retirement by having a financial plan in place before retirement begins. If you are not sure where to start or want to have your existing plan reviewed, schedule your 30-minute introductory one-on-one retirement strategy call by clicking here.
The opinions voiced are for general information only and are not intended to provide specific advice or recommendations for any individual.
