One of the first things we like to ask our clients is, “How do you picture your retirement?” After all, the first step to making an income plan is to establish your lifestyle expectations. Some people have decided upon a very specific vision for their future. On the other hand, we sometimes hear the following replies:
“I haven\’t even thought about it yet!”
“I don\’t know… I guess I\’ll retire around age 65, right?”
What\’s wrong with the first answer: We should all begin preparing for retirement when we begin our careers! Granted, most people in their twenties or even thirties probably don\’t have a set vision for their retirements, but they should at least acknowledge its inevitability and begin saving. If you\’re over forty, you should begin to formulate a more concrete idea of your future.
What\’s wrong with the second answer: This person doesn\’t sound very sure, and seems to be assuming that retirement will just “happen” one day (when they turn 65). There\’s certainly nothing wrong with retiring at that age, but it might not happen unless you\’ve crafted a very particular plan.
Don\’t believe us? This statistic might surprise you: One in five Americans over age 65 is still working. That\’s approximately 20 percent of people who probably thought they\’d be retired by now.
Granted, some people do continue working because they enjoy it. But for most of these would-be retirees, they\’re working simply because they cannot afford to retire.
Then there are others who are not physically able to keep working. Nearly 20 percent of Social Security recipients, age 65 and over, have no other form of income. And for 33 percent of recipients, their Social Security benefits comprise 90 percent of their income! That\’s over half of retirees who rely solely, or almost solely, on Social Security.
What can we deduce from these statistics? Unfortunately, the typical retirement scenario (around age 65, on a comfortable income) is becoming less common. For most of us, the only way to accomplish that lifestyle is to set a goal early on, and diligently work toward it throughout our 40s, 50s, and beyond.
A secure retirement is probably within your reach, but you need to prepare for it now. Schedule a meeting with us so that we can identify your goals, and create a plan to help you reach them.