As we start a new year, for some it’s new resolutions, for others it’s taking life in a whole new direction. A question that always stresses people is ‘do I have a enough to retire?’ Independent retirement planning advisor Mike Reeves of Strategic Wealth Designers joined the newscast to talk about how to know if you have enough to go to the office for the last time ever. He says that depends on your financial plan, your lifestyle and if you truly want to retire.
“Retirement might be closer than you think, or you might be in a big hole and you don’t realize it,” Reeves says. “The first thing I’m looking at when talking with folks about retirement planning is their current expenses versus the money they have saved for retirement. If you are spending $10,000 a month but only have $200,000 saved for retirement, generally those numbers aren’t going to work in retirement, unless you have a large pension to fall back on. I don’t know anyone who wants to take a pay cut in their retirement years, so it’s critical to build a financial plan that keeps you on track to accomplish the goals you have for retirement.”
A commonly asked question is ‘can I retire with 500K at 60?’and several questions need to be answered to know if it’s a yes or a no. If someone plans to live in a home with a minimal mortgage and maintain their spending and not raise expenditures, things may work out. Conversely, if big trips each year are part of the goal or living in a new place that has a higher cost of living are a desire it may not be enough. Reeves says its important to build a portfolio that is structured for what retirement looks like to you, if you have big plans in retirement then you need to be planning for that now. Build a financial plan that can generate income in your retirement years.
“Many people save a nice nest egg over the course of their lives but then look to make big changes once they retire,” Reeves says. “The issue that can arise if you haven’t financially planned for these changes is that you see that nest egg going out the window faster than anticipated. Unfortunately, too often people are too far behind on their savings for retirement. If you haven’t already, start saving now, pay yourself first and when you move up in your career continue to put more back, so when you do want to retire, you can smoothly transition into life without a 9-5 schedule.”
Conversely, sometimes people have worked 2,3 even 5 years longer than they needed to because they either didn’t realize they were in a strong position or they just enjoyed their career so much. To see additional stories surrounding business and economic news for the Indianapolis area, visit https://CBS4Indy.com/Strategic-Wealth and if you have a question for Mike send an email to email@example.com.