You haven’t saved for your retirement? It’s never too late
Have you saved enough for retirement withdrawals to bridge the gap between guaranteed income and what you want to spend? Otherwise, don’t despair.
First, remember that it’s never too late to get on the right track. That said, there is no better time than the present. The following suggestions will help you get started.
If you didn’t contribute money for retirement when you were younger, you’ll need to increase your current savings to catch up. The following strategies can help you save more.
It’s easier to save money you’re not used to having. Every time you pay off a loan, get a raise or bonus at work, or get other extra cash, consider directing new cash flow directly into your retirement savings account.
You can also keep your pandemic level expenses lower. Can you take smaller or less frequent vacations? Are you able to minimize dining out or downgrade to a cheaper car?
Is additional work or a parallel activity possible? Is overtime an option? Airbnb your basement?
Invest for higher rates of return
If you have the time and tolerance to ride out short-term market declines, you may be able to reap more of the expected long-term market profits by investing more in stocks than in bonds or cash.
Wait to retire
There are two advantages to postponing retirement. First, you will have more years to fund your retirement account. Second, you’ll have fewer years to spend your retirement nest egg. Especially if you continue to work and delay applying for Social Security until age 70, it is possible to increase this benefit by up to 24% compared to what you would have received at full retirement age. (67 years old for the most part).
In summary, if you need to catch up on your retirement savings, there is no magic wand or time machine. Start now by saving more, investing and/or waiting longer before retiring.
Savant Wealth Management (“Savant”) is an SEC-registered investment adviser headquartered in Rockford, Illinois. You should not assume that any discussion or information contained herein serves as receipt or substitute for personalized investment advice from Savant. This is intended for informational purposes only.
Kevin Kingston, CLU, Chartered Financial Consultant, is Managing Director and Financial Advisor at Savant Wealth Management; savantwealth.com