When most people think of retirement, they think of an age. They usually think of getting on social security when they turn 66 and living out the rest of their lives without a care in the world. As great as that sounds, we shouldn’t be thinking about retirement in terms of an age. Retirement should be thought of as a dollar amount, more than an age. The truth is, you can retire much earlier than 66 if you’re careful and persistent with retirement planning.
Retirement planning can be as involved as you want it to be. However it’s like many things in life; the more effort you put into it, the more you get out of it in the end. Sure, social security might net you enough money each week to get by, but you should really be thinking about the kind of life you want to live in retirement.
If you want to kick back on the beach with your significant other in your golden years or even just maintain your current lifestyle, you’re going to need more than just social security, unfortunately. You should note the average monthly social security check is $1500. How much will you need? That’s the fun part, as it’s entirely up to you. In order to figure out how much money you will need to retire, you need to plan out what you would like retirement to look like. Finding that out will help you gauge how much money you will need to facilitate that lifestyle.
Once you know the annual income you will need in retirement for your lifestyle, you need to actively work toward that goal by saving and investing your money. If you’re not familiar with the best practices when it comes to saving and investing, consulting a professional may be worth it. You may be put off by the fees that they charge at first, but if you choose a financial planner wisely, they’re worth it. Even the most seasoned DIY investor can still gain from a financial planner (star quarterbacks still have coaches).
You can also try to go about it on your own.
Here is a simple free retirement calculator that we like. The small adjustments you make now can really have compounding effects down the road. After all, your retirement is on the line, and remember, retirement is a number and not an age!