Retirement is a time of your life that you have been dreaming about for years. You may finally be able to do what you want, when you want, and not worry about the daily grind of work. But before you start planning your retirement, take some key steps first to ensure it will be as enjoyable and fulfilling as possible.
Retirement planning is a complex process, but it doesn't have to be. We know that retirement can seem like a daunting task, and we want to help you make sense of your options so you can retire with confidence. There are so many different factors that go into it, and there's no way to know what will happen in the future. But with these essential tips from Mullooly Asset Management, you can be better prepared for your retirement years. You may not have thought about retirement before now, but it's never too early to start planning for it! These simple steps will help you get started on your journey towards financial freedom. And when you work with us at Mullooly Asset Management, we'll make sure all of your investments are working together as a cohesive unit so they can provide maximum returns over time. We take care of everything so that you don't have to worry about anything except living life!
1. Consider the money you will need for retirement
Do you know how much money you will need after retirement? It's a hard question, but it is one of the most important questions to answer. Will your pension be enough? What about Social Security benefits? And what about all of those expenses that are only paid for during work hours - mortgage payments, utilities, grocery store trips, medical bills. How do you plan for these things in retirement if they're not being paid anymore?
2. Create a budget
Many people are afraid to retire because they don't know how much money they will need to live comfortably in retirement.
First, estimate your annual living expenses, including mortgage/rental payments, utilities, groceries, prescriptions, and other household necessities. Next, determine how many years until you retire and multiply this number by 12 (the number of months per year). Now multiply this total by 80% (the percentage used as an average life expectancy) and add $10-$20K ($1000-$2000 per month) for unexpected costs such as home repairs.
3. Start saving now
It's never too early to start saving for retirement. In fact, starting as soon as you're able to be one of the smartest moves you'll ever make. The earlier you start, the more time your money has to grow and compound over a lifetime. And if that sounds like a lot of work, don't worry! It doesn't need to be complicated - it can be simple and effective with just a few small changes in your current spending habits.
4. Get an estimate
It's essential to map out how much money will be needed in retirement - this can range from $1 million all the way up to $5 million or more for those who live an extravagant lifestyle! And don't forget about Social Security benefits- they're usually calculated as around 1/3rd of your income during working years, so if this is a significant source, then plan accordingly.
5. Review your investments
I'm going to be honest, Even if you are not a financial planner or expert. But that doesn't mean that you can't review your investments and make changes as needed for retirement. After all, you only live once, so it's essential to take advantage of any opportunity possible to live the best life possible. Knowing your goals before making any investment decisions is key - there's no point in setting up an investment plan if you don't know where you're headed!
6. Identify any tax-advantaged accounts
A retirement account is a particular type of investment that offers tax benefits when contributing and withdrawing from the account. The two most common types are individual retirement accounts (IRAs) and employer-sponsored 401(k)s. In addition, Roth IRAs offer different tax advantages depending on income level, with no upfront contribution required like traditional IRAs. The best thing you can do is identify any tax-advantaged accounts you can invest in.
Final Words:-
The decisions you make now will have a lasting impact on your retirement years. To help ensure that your future is as fulfilling and happy as possible, we encourage you to take some time to think about the different aspects of retirement before it becomes a reality. We offer an assessment service that can provide personalized recommendations for how best to plan for this vital stage in life. If you want more information or would like to schedule a consultation for your retirement planning in NJ with one of our experts, please give us a call at (732) 223-9000 today!