Is Average Retirement Income Enough?At its most basic, an average retirement income plan is money that you aside, simply, for retirement purposes. Many employers now offer retirement plans, from simple individual retirement accounts (IRAs) to tax-sheltered annuity plans (403b). However, knowing which is best for your retirement takes a little homework, and some discipline to keep up with the regular contributions. According to the big money gurus, you need up to 75 percent of your present income to retire, and keep your current lifestyle standards. For example, if you make $100k a year now, you'll need roughly $75k to maintain your current lifestyle. If you make $50k a year, you'll need at least $38k to retire. Can you guess how much you will need if you take early retirement. However, the good news is that for people considering retirement, one must realize that often, most retirees would have already paid off life insurance plans and mortgages. Also, those expensive kids are long gone. And because they already paid off the kids education expenses, they can use their retirement savings for other important spending. It also means that retirees have paid off all credit card debt, as well as cars, to reduce the monthly overhead. Most retirees often consider a move to a smaller house, or even a different state to reduce overhead living costs. Health insurance and medical benefits are the main consideration for retirees, as are prescription drugs and medical out-of-pocket expenses such as pharmaceutical supplies and needs not covered by Medicare or other government funded programs. Plan and buy a long-term care insurance policy for both you and your spouse and try to maintain a healthy, active lifestyle. However, if you have planned properly, you should be able to live comfortably with a few basic expenses. Take stock of your entertainment needs when considering what your average retirement income should be. Do you entertain a lot? Do you like to travel or are you planning on staying put, enjoying the simpler things in life? Knowing ahead of time what you're planning will help you to decide how much money you're going to need to retire. If you're not sure, try an experiment. Before you retire 'for real', try living on what you have determined to be your average retirement income allotment for a few months. If you get by without trouble, then you're right on track. However, if you find yourself running short of money, or having trouble paying bills or doing the things you want to do, then you need to reassess your goals and try to cut corners in other areas. These days, planning for retirement isn't easy, nor is living on a fixed income while retired. Plan for those days when nothing matters, and peace and joy fill your days. You can still live the good life in your retirement. Simple Ira >> Privacy Policy >> Terms Of Use >> Disclaimer >> About Us >> Contact Us |