7 ways retirement is different now
More than ever, workers are having to take responsibility for planning and financing their golden years. Here’s what the not-yet-retired need to consider.
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If our old folks used their head & had their mortgage paid off when retirement time comes, they wouldn't be in a bind. Today many of them take out a second mortgage to put kids thru college or buy expensive toys.
Don't get me wrong, putting your kids thru college or buying luxury items is A OK, but don't hock up your home for it.
There's nothing more important in our lives that that home. It must always be the first bill you pay & when you pay it off your retirement years will be great.
EF Hutton :)
How much do you need in retirement? To answer this, you must answer:
1) What will the inflation rate be over my retirement (no one can answer, but likely much higher than now)
2) What will my health be like? (no one can answer, but some are healthier than others. If you are unhealthy, assume that $260K they indicate will be $1M with health care cost inflation)
3) What will the return on my savings be? (no one can answer, but likely not as good as in the 80s and 90s)
4) How many years will I live? (no one can answer)
5) What will the tax rate be on my 401K distribution? (no one knows what tax rates will be, but likely higher)
6) How much will SS and Medicare provide? (no one can answer, but likely less than now. And if you have managed to save a 401K, that money WILL be counted against you when they implement means testing)
So, if you are about to retire, I think $27.8M is about right.
I have a friend who SS is going up in Jan.13....1.7%. He gets $17 a month more and his medicare went up over $8, that leaves him with a little over $8 a month increase. Ooops wait, his association fee went up $20 a month, now he's worse off than he was. That's what old folks get in our country. His 401 got wiped out. Oh and the water company, gas company and power company wants their yearly increase, he just seems to be going backwards financially. He keeps cutting or trying to cut expenses but they keep going up so fast.
How annoying is it that this country gives BILLIONS & BILLIONS AWAY IN FOREIGN AID and we don't take care of our seniors?
I will be retiring from my current job in less than four months following 38 years of employment there. I have already started interviewing for my second career that I hope will last another 10 to 12 years, taking me to full SS benefits age. The additional 10 to 12 years of work will also allow for further growth of the lump sum distribution I will be receiving in lieu of monthly pension checks
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