HERE'S HOW TO HELP YOUR RETIREMENT SAVINGS LAST A LIFETIME.
Outliving retirement savings is a top concern for many Americans. In fact, only 18 percent of works say they are very confident they have enough money for a comfortable retirement. (1) Whether you've just started working or you're ready to retire, these strategies can help make your money last.
Step 1 Calculate how much you need
- Only 44 percent of works have figured what they need for a comfortable retirement (2)
- Saving 70 to 80 percent of your pre-retirement income for each year in retirement is a good goal.
- Get an estimate online with the State Farm Retirement Illustrated Calculator.
Step 2 Start saving today.
- 26% of works age 25 and older say they haven't contributed to their retirement. (3). If that's you, it's never too late to start.
Try these strategies to boost your savings:
- Created a budget. Cut nonessential expenses, and you'll trade spending for saving.
- Increase your savings. First, aim to set aside 10 percent of your income each year. Then increase it by 1 to 2 percent annually.
- Contribute often. Chip in on your employer-sponsored retirement savings plan - the tax deferrals are hard to beat.
- Ditch debt. Pay off debt now to lighten the financial load in retirement. Doesn't it sound nice to retire without a mortgage?
- Roll over 401(k) plan balances into an IRA. You'll keep the money for retirement and avoid current taxes. Learn how.
- Make catch-up contributions. As of 2015, starting the year you turn 50, you can add up to $6,000 a year to a number of retirement plans, including your 401(k). Learn more about catch-up contributions and how much you can contribute to your IRA.
- Consider health care costs.
- 62% of workers 50 and older are savings, but 55% are worried they may not be able to afford retirement healthcare expenses. (4) Long-term care insurance can help mitigate some costs. (The earlier you buy, the better.)
- Wait for social security. Get 100% of your monthly benefit by waiting until age 66 for individuals born between 1943 and 1954. Full retirement age varies by birth year. Get 132% if you wait until age 70 (5).
1 Employee Benefit Research Institute; http://www.ebri.org
2 Employee Benefit Research Institute; http://www.ebri.org
3 Employee Benefit Research Institute; http://www.ebri.org
4 AARP 'Planning for Health Care Costs in Retirement, A 2014 Survey'; http://www.aarp.org
5 Social Security Administration; http://www.ssa.gov
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