Calculating Retirement

Yogi Berra once said, “You’ve got to be very careful if you don’t know where you are going, because you might not get there.”

When it comes to retirement, plenty of people get there -- but it may not be what they expected because they either didn’t plan, or their financial strategy didn’t help keep them on the path to their goals. The difference between a satisfying retirement and one with financial concerns may be correlated with how early and how well you plan.

In some ways, what you may hear about creating a financial strategy for retirement can sound similar to the advice high school graduates receive when applying to colleges: Develop a strategy for your dream retirement, one that you are most likely to achieve, as well as a fallback option or two. And remember that retirement planning is personal, so you’ve got to do what’s right for you. 

That means taking into account all the people you’ll need to provide for, your assets, your income and savings rate from now until retirement, your investment goals, your timeline, your tolerance for market risk … there’s a whole spectrum of things to consider. That’s one reason why it’s  important to develop a relationship with a financial advisor who can help not just to develop a financial strategy, but to adapt that financial strategy as your circumstances may change. We can help you with that by creating a financial strategy utilizing both investment and insurance products that can help you work toward your long-term financial goals.

One of the first steps to retirement planning is figuring out how much income you’ll need once you stop earning a paycheck. Based on data gathered by the Bureau of Labor Statistics in 2014, the average retired household spends $40,938 per year.

There are calculators on the internet that may help you determine if you are on track to have enough savings to provide for your retirement. If you’re trying to figure out how much your investments may possibly earn by the time you retire, try this Return on Investment calculator. 

Want to figure out how much you would need to save to become a millionaire? This calculator lets you adjust your monthly savings to find out how much and how long that could potentially take, based on your savings and a hypothetical average return.

Once you’ve established how much you can potentially expect to accumulate by retirement, use a withdrawal rate calculator and required minimum distribution calculator to help determine approximately how long your nest egg may last.

Retirement planning is a complicated process because there are so many unknowns, like not knowing how long you’ll actually live. However, there are many tools available at your fingertips, and we are just a phone call away. Remember, it helps to figure out how much savings you may need to retire, so you can create a well-thought-out financial strategy.

Interested in reading more?  Here are some articles that may be of interest to you:

[CLICK HERE to read the article, “The 50 Greatest Yogi Berra Quotes,” from USA Today. September 23, 2015.]

[CLICK HERE to read the article, “The High Cost of the Retirement Dream,” from U.S. News & World Report. November 3, 2014.]

Raymond C. Lantz, Jr. is the president and founder of USA Wealth  Group, Inc. Ray has many years of experience advising clients in retirement and sophisticated tax planning strategies, multi-family and commercial real estate projects, and legacy planning. Ray is a graduate of Clark University, holds a law degree from Boston College, and a master of laws in taxation from Boston University. You can hear him every Sunday on Money Wise with  Ray Lantz on WBSM 1420AM or on the Radio Pup app.