Retirement savings deficit | wfmynews2.com

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A new survey indicates that 40% of Americans actually fear retirement more than death. The study found that 87% of people fear they will not have enough income in retirement. The second biggest fear is losing Medicare. Various factors influence these fears. Many Americans face a retirement savings shortfall, and more than half are worried about the future of Social Security.

When deciding to retire, one of the main factors to consider is whether you have enough cash on hand. To maintain your retirement lifestyle. A comprehensive plan will help you feel more secure because it describes your retirement goals and the path you need to take to reach them. A financial plan gives you the opportunity to review your goals, update them, and track your progress.

One of the best things to do if you’re behind on retirement savings is to increase the amount you contribute to your retirement accounts. Ideally, you should contribute 10-15% of each paycheck to your 401 (k). If you can’t handle this, you have to contribute at least enough to get the business match. Once you start saving, go up to that 15% by increasing your savings by 1% each year. Some retirement savings plans will let you automate the increase in contributions, so you don’t even have to think about it. Another good idea is to increase your contributions with every raise you get. This way you start saving money before you get used to it and start spending it.

Health care is one of the biggest expenses for retirees, let alone one of the most unpredictable, but people often overlook it. An average retiree couple 65 this year would need about $ 300,000 in after-tax savings for health care costs during their golden years. To estimate how much you’ll spend on healthcare, look at your current health, family history, and expected longevity. I recommend setting aside 3-6 months of spending in a separate savings account. This money should only be used for an unforeseen expense such as a hospital bill.

Social Security will likely be there, but you shouldn’t make it your only source of income in retirement. Social Security is only designed to replace around 40% of your income, and we tell clients that they are likely to need at least 80% of their pre-retirement income to maintain the lifestyle they want. retired. Social Security rules are complex, so it’s important to have a strategy for tapping into your benefits. I recommend that you sit down with a financial professional and discuss all of the options available for your specific situation.

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