Saving for Retired Life: Concerns and Methods
If you are worried about running out of money in retirement, you are not alone. A new study from the Indexed Annuity Leadership Council shows about 25% of people’s biggest fear is running out of money in retirement.
25% of Americans are concerned with outliving their retirement savings. 19% are concerned about covering health care expenses, and 23% are concerned with being able to maintain their lifestyles. These concerns are related to not having enough savings. One in four baby boomers have less than $5,000 set aside for retirement. To put this into perspective, the average couple last year will need about $240,000 to cover future medical expenses while retired.
It is never too early or too late to start saving for retirement. If you feel you can not afford to save, look for a budget and find ways to cut costs. Saving a little now can help a lot later on. According to a study done in 2013 by Gallup poll, two-thirds of Americans to do not keep a budget. Or if you do and it works for you now, there is a good chance the same budget won’t work for you in retirement.
If you don’t budget, you can run into big problems like overspending and running out of money. President of Cirrus Wealth Management, Joe Heider says, “budgeting in retirement is more important in retirement that when you are working”. If you overspend while you are working, you always have more income. In retirement, if you overspend, you will start dipping into your principal. You don’t have the earnings to make up for it, and it can cause a downward spiral.
A budget can eliminate stress in retirement. After all, retirement is supposed to be relaxing. Budget throughout your adult life so you can enjoy your retirement. Be specific with your budget keeping. If you are not sure where or how to start, contact a financial planner. Get on top of your retirement today.