Where do you want to be during your golden years? Do you want to see the world? Buy that sports car you dreamed of? How about that retirement beach house? To start planning, write down your goals for retirement. Once you have decided, think about what it may take to get there.
Many American workers anticipate an enjoyable retirement after years of the daily grind and commute. Whether it is traveling, golfing, relaxing by the pool… the possibilities seem truly endless. As workers daydream about the world of retirement, few venture to determine how much their retirement lifestyle might cost.
Every year a Retirement Confidence Survey is conducted by the American Savings Education Council. If you don’t know your retirement goal amount, you are not alone. A 2009 survey found that 44 percent of workers believe they will reach their saving goal even if they guess at the amount of money they will need. An equal proportion (44 percent), have attempted to calculate their retirement needs. While this figure gives you a hard number, it could grossly misrepresent your plans for retirement. Your retirement finances are dependent on length of life, medical expenses, your retirement lifestyle and what you might need during those years.
There are many savings options that may be available for your retirement nest egg. The following are the most common and here are the contribution limits for 2010.
Individual Retirement Account (IRA) or the Roth IRA, the lesser of $5,000 or 100 percent earned income. If age 50 or older the “catch-up” is an additional $1,000.
Savings plans such as a 401(k), 403(b), and 457(b), the lesser of $16,500 or 100 percent compensation. If age 50 or older the “catch-up” is an additional $5,500.
Most people would find these limits insufficient for their retirement needs. However, the earlier you start, the more time your money has to potentially grow. Calculating your retirement need is critical to your future, get help from a financial advisor.
For more information contact Rebecca Robins, CPA/PFS, CFP®, at 661-702-9680 or visit the office at 25001 The Old Rd, Stevenson Ranch, CA 91381, CA Insurance Lic#0D75745.
Securities offered through H.D. Vest Investment ServicesSM, Advisory Services offered through HD Vest Advisory ServicesSM, a non-bank subsidiary of Wells Fargo & Company, Member SIPC,
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