We all have to retire at some age. After all, there is a lot to be enjoyed in this beautiful world and after working hard for many years, you will have earned some time out! However, most American’s have not done a brilliant job of saving for retirement, with the average 50-year-old stashing $60,000 in the bank for retirement. This is nowhere near enough to secure a comfortable financial future for the family.
As confidence plummets among workers who haven’t yet put aside adequate funds for retirement, just 25% of people say they have no plan to work in retirement, according to Bankrate.com. So, as the people of America remain in the workplace for longer, the question remains: “How can we make steps to ensure retirement in our 60’s?”.
Considering the fact that an estimated $260,000 is estimated to be spent on healthcare by a retired couple, retiree’s must take increasing health costs into account and figure out a strategy. This strategy should focus on increasing income for an earlier retirement, among many other things.
Taking the Right Steps to Retire in Your 60’s
Life expectancy is increasing and while this is a good thing, the news is also causing workers to feel worried about their financial future. Don’t worry too much if you planned on sipping fine wine in your mid-60’s without a worry in the world because the goal is still realistic.
Social Security Income (SSI) dependence is a big problem for the people who are spending more than they earn. By remaining disciplined and following these steps, retirement in your 60’s in very likely:
- Save a Big Portion of Income – It sounds like the obvious thing to do, but one of the main mistakes that workers make ahead of retiring is failing to structure a realistic savings plan. The plan should not put that person in an uncomfortable position financially. It should enable them to live comfortably during the working years, before dipping into the money pot in their 60’s. Aim to funnel 15% of your income into a savings account from as early as possible. Increase this amount to 25% if you are aged 40 or over and strive to retire in your 60’s.
- Don’t Forget about Taxes – Don’t let yourself become a victim of tax. Acting in a tax-efficient manner will help you to build a nest egg much faster. Tax-free saving options include 401(k) plans and IRA plans. Consider an employer-match plan, if it is made available and whatever you do, remember to track your savings. As you watch the bank balance grow, your desire to dip into those hard-earned savings will diminish!
- Include Stocks in Your Portfolio – A huge chunk of your portfolio investments should be stocks. Allocate assets wisely and diversify with different asset classes to reduce risk. According to CNN, big stocks have raked in a 10% return on investment (ROI) since 1926, making stocks a better wealth-building choice for money management in the retirement years.
Building wealth for early retirement is absolutely essential if you want to make the most of the golden years. The longer you work, the higher the chances of potential health complications developing, thus hindering your ability to enjoy the finer things in life. With the above tips for retiring in your 60’s, you can watch your bank balance grow and experience financial freedom.