Preparing for Retirement: Four Time-tested Truths

June 11, 2021

After all your hard work over the years, you want to ensure you have the retirement of your dreams. There are various actions and paths you can take when preparing for retirement. The Retirement Industry Trust Association (RITA) can help you develop an efficient and targeted plan that will satisfy your unique preferences. Let’s look at some of the steps you can take toward a successful retirement.

Set Goals

It is essential to have a clear vision of how you want your future to look. Working with a financial planner to calculate your retirement will help you immensely. Your financial adviser will help you set goals related to your lifestyle, your desired age at retirement, and how much money you want in the bank during your golden years. Some financial planners advise people to save 25% of their annual income toward their retirement goals.

Create a Plan

Considering your current age, future desires, and rate of inflation, your financial advisor will help you develop a plan to reach the goals you have set for yourself. Most people plan for their retirement income to last 25 to 30 years; take steps to protect your retirement savings in the future by making sound financial decisions today.

Make Monetary Adjustments — Now!

Compound interest is your friend. The earlier you start saving toward your retirement, the better chance you will achieve your goals. Research shows that most retirees will need about 70-80% of their current income during retirement. An early establishment of accounts such as a 401k or an IRA will help track your progress, ensure that you stay on course, and maximize the power of compound interest. Our trust association can help ensure that your investments remain secure with one of our trusted IRA custodians.

Review Your Insurance Needs

As you age, your insurance needs will change. The primary function of life insurance is to replace your income to protect dependents should you die unexpectedly. Thus, dialing down your life insurance costs might be smart once you have fewer dependents and debts. Contrarily, since health problems can develop later in life, you will want to take out a policy before they occur. Some insurance products to consider are critical illness insurance or long-term care insurance. If you plan on traveling during retirement, it might be wise to consider travel health insurance. With so many options and considerations, it is best to consult with your financial advisor to ensure your insurance decisions align with your retirement goals.

Setting a clear financial path for your future is one of the best things you can do for yourself. It is never too early or too late to start planning for retirement. This list covers the very basics you should consider when planning your retirement. For help in preparing for retirement, contact one of our advisors today.