If you’re like most Americans, you’re looking forward to enjoying a nice, long retirement. But just how long will it be? It’s an important question to answer because the longer your retirement lasts, the more years of expenses you may have to fund with your savings.
Obviously, you can’t predict when you will pass away. However, longevity and mortality data provide some insight that could guide your decision-making. According to researchers, there’s a chance your retirement could last much longer than you think.
Are you one of the millions of Americans using qualified accounts such as 401(k) plans or traditional IRAs to save for retirement? They make for effective saving tools, primarily because they offer tax-deferred growth. That means you don’t have to pay taxes on your earnings as long as the funds stay in the account.
You can’t delay those taxes forever, though. With the exception of the Roth IRA, most qualified accounts have taxable distributions, which means you have to pay income taxes on withdrawals.
Is retirement approaching quickly? Before you know it, your working life will be over and you’ll be enjoying your golden years. You’ve probably been thinking about what retirement will be like and how you will fund your expenses. Planning ahead can take much of the uncertainty and anxiety out of retirement.
Unfortunately, you can’t plan for everything. Emergencies happen, and they often bring great expense. You may also find that once you’re retired, you find new interests and hobbies. They could be things that you hadn’t anticipated while you were working.
While retirement and financial independence share some similarities, there are slight differences between the two. Retirement is part of a natural life cycle. You work for a long period of your life saving money. Then, once you reach retirement age, you stop working and enjoy the rest of your life in the manner that you wish.
Financial independence, on the other hand, is something that can be achieved at any age. You’re financially independent when you have enough assets and resources to decide on your own terms how, when and where you work. You may work, or you may not, but the decision is up to you.
It’s that time again already. Time to turn the calendar to a new year. For many Americans, this is also the time to reassess certain areas in their life and make resolutions to change for the better. Common resolutions include losing weight, kicking a bad habit or finally pursuing that lifelong dream.
You may want to include a retirement plan review in your resolutions for 2017. According to a recent Gallup study, 64 percent of Americans say they’re worried they won’t have enough money to retire comfortably. In fact, retirement has been the No. 1 financial concern every year Gallup has conducted the study.1
The first few years of retirement can be particularly hazardous to your finances. When adjusting to your new lifestyle as a retiree, it’s easy to get caught up in the spending trap that can result from the increase in free time.
Many new retirees fill all that newfound free time with activities such as shopping, traveling, dining out or expensive new hobbies. An increase in spending is a common pitfall of the newly retired.