Research shows that more than half of us will underestimate how much money we will need to live on in retirement, primarily because most of us also underestimate how long we will live. But with the average life expectancy at an all-time high and rising, pre-retirees need to get a realistic grip on planning for a financially secure retirement.
Here are 5 steps you can take now to improve your financial life later:
Get real. Obviously none of us knows how long we will live, but you can make an educated guess – so educate yourself about your family’s health history and get guidance from a financial adviser on the income you will need to sustain you throughout your life.
Make saving a priority. Saving for retirement needs to be a priority, and you may need to sacrifice some discretionary spending now in exchange for financial security later. Even small amounts added to your savings can make a big difference later on.
Plan for the unexpected. A serious illness or a major injury can make a big dent in your savings if you haven’t put aside some money in an emergency fund or have inadequate insurance.
Plan for the future. If you haven’t done any retirement planning, at least use some online planning tools as a starting point. Once you have a fix on what your future may look like, you can then draw up a detailed plan to deal with it.
Get help. Research shows that people with a retirement plan have more saved for retirement than those who don’t. Engage a professional adviser or estate planning attorney to help you develop a comprehensive plan.
The Flanigan Law Group is a California estate planning, administration and litigation legal services law firm. For more information on retirement planning, contact the Flanigan Law Group at 949-450-0041.