The First Stage of Retirement
The First Stage of Retirement
Pre-Planning
Planning for retirement should start about the same time you get your first full-time job. Unfortunately, when young thinking fifty years into the future is not on most people’s minds. People start actively being concerned about the age of fifty. Most people think about the financial goals of retirement – “How much money do I need to retire?” or “Can I afford to retire?” Evaluating their savings and pouring every extra cent into savings, retirement funds, the stock market, or 401K’s. If your employer offers a retirement savings plan, sign up and contribute all you can. Your taxes will be lower, your company may kick in more, and automatic deductions make it easy.
Cost
Retirement is expensive. Experts estimate you will need 70 to 90 percent of your preretirement income to maintain your standard of living when you stop working. Social security will not provide that much income. People who don’t make plans for the future wind up poor in retirement. Social Security retirement benefits replace about 40 percent of a median wage earner’s income after retiring. You may estimate your benefit by using the retirement estimator on the Social Security Administration’s Website. The cost of living goes up, but your income won’t.
