Although the amount of money required for retirement depends on each person, there are some recommendations from specialists to help you find the perfect figure for you
Many workers idealize their retirement as a moment of eternal rest and zero activities that are not fun and playful. However, to really have the peace of mind that many retirement images show, you must save and quantify the amount of money you need, since there is no single figure for all retirees.
Each person must determine how much money they need for retirement. When you plan your retirement, you should ask yourself a series of questions that will help you calculate the income that you will require, such as when do you plan to retire? What are your expenses now compared to what you want them to be when you retire? What are you currently doing to save for retirement?
“For anyone contemplating (how much they need to retire), especially those approaching retirement age, I can’t recommend highly enough working with a financial advisor to create a personalized plan for saving and spending in retirement,” Shweta said. Lawande, senior adviser at Francis Financial in New York City, told USA Today.
According to some experts, it is recommended that people make an estimate of 80% of their pre-retirement income. In addition, you should consider the finances you will need to support your loved ones and family members, as well as for medical expenses. Especially when it comes to the latter, life can be unpredictable, so it’s key to consider the costs of procedures or medications, even if you’re in good health.
If you plan to travel, entertain, or pursue a hobby, you may need to add additional savings to pay for these activities.
If you are about to retire, there is the 4% rule, which will allow you to set a withdrawal rate for each year for 30 years, adjusting for inflation over time.
But regardless of an amount, you can raise up to $1 million for your retirement, as long as you start investing in retirement as soon as possible, so you have plenty of performance time in your retirement investment accounts.
It’s true that retirement feels far away when you’re young, but it’s the right age to start investing for retirement. Savings are not enough, it is good that you have a 401(k) plan or an individual retirement account (IRA) to grow your money.