Americans' Concern About Having Enough to Retire: How Much is Enough?
As retirement approaches, many Americans experience a growing concern about whether they have saved enough to sustain their desired lifestyle. A recent Kiplinger report suggests that almost 75% of Americans have financial regrets and not saving enough for retirement is the leading regret.
According to a new survey from Bankrate, 34% of baby boomers (ages 59-77) said they regret not saving for retirement soon enough, vs. 26% of Gen X (ages 43-58), 11% of millennials (ages 27-42) and 5% of Gen Z (ages 18-26).
This worry is understandable, given the uncertainties in the economy, healthcare costs, and increased life expectancy. So let's explore, how much is enough?
Assessing Retirement Needs
Determining how much you need to retire comfortably involves considering various factors, including your desired lifestyle, expected expenses, healthcare costs, and potential inflation. It is essential to create a comprehensive retirement budget that considers both necessary and discretionary expenses. Consulting with a financial advisor can provide valuable insights and help you establish a realistic retirement savings goal.
Retirement Saving: The Importance of Starting Early
One of the most effective strategies to ensure a comfortable retirement is saving as early as possible. By starting early, you can take advantage of compound interest and give your investments more time to grow. Even small contributions over a long period can make a significant difference in building a sizable retirement nest egg.
Using Retirement Calculators
Retirement calculators are useful tools that can help estimate how much you need to save based on your current age, income, savings rate, and other variables. These calculators consider factors such as inflation, investment returns, and life expectancy to provide an approximate retirement savings goal. While they offer a starting point, it's important to remember that they are not absolute predictors and should be used as guides.
Consider Lifestyle Adjustments
Retirement planning is not solely about financial considerations. It also involves evaluating your desired lifestyle during retirement. Reflecting on your expectations and considering potential lifestyle adjustments can help you align your retirement savings goals with your aspirations. For example, downsizing your home or adjusting travel plans can free up funds for other expenses.
Regularly Review and Adjust
Retirement planning is an ongoing process. It is crucial to review and adjust your financial plans periodically to account for changes in your life circumstances, financial goals, and market conditions. Life events such as marriage, children, career changes, or unexpected expenses may require revisiting your retirement strategy. Staying proactive and keeping an open line of communication with a financial advisor can help you stay on track.
Talk to a Financial Planning Professional Today!
Worrying if you have enough to retire is an important conversation to have with a Certified Financial Planner. Careful planning, diligent saving, and informed decision-making are all steps to achieving a financially secure retirement and a crucial part of how Bradford Financial Center clients prepare for this important milestone.
Understanding your retirement needs, starting early, using retirement calculators, considering lifestyle adjustments, and regularly reviewing your plans will contribute to a more confident and successful retirement journey. Remember, it's never too late to take control of your financial future and make the necessary adjustments to ensure a comfortable retirement.
If you're ready for a FREE, no-obligation review of your current financial portfolio with a Bradford certified financial planner, please reach out to schedule a call with our team.