How Much Do You Need for Retirement

By: Joseph Kenny
Submitted: 2007-01-17 16:16:47
Print this article | Tell a friend | For publisher | Social Bookmarking
Rating:
 

With an increasing number of people scheduled to begin retirement in the next few years, it is important to begin thinking about the subject. Even if you’re not near the age of retirement yet, it’s a good idea to begin thinking about how you plan to fund your retirement as soon as possible. The sooner you begin to plan for retirement the more you can be sure your retirement won’t be plagued by money issues.

So, how much money do you need for retirement? A lot of that answer, of course, depends on what plans you have for retirement. If you plan to travel, want to purchase a RV or you have similar specific plans, you will naturally need more money in order to fund your retirement. Above and beyond those expenses; however, it is important to think about your day to day essential needs.

For example, consider whether you will still owe any debt payments when you choose to retire. Of course, many of use would like to think that we’ll be out of debt by then but in reality you may still owe on a vehicle or credit card or even a house. Be sure to calculate those costs into the amount you need for retirement.

You’ll also need enough money to cover such costs as utilities, auto and home insurance, groceries and other miscellaneous expenses we all must pay on a month to month basis.

Healthcare will be an extremely important aspect of your retirement. Naturally, as we grow older our healthcare needs increase and that means spending more money. If you fail to fund your retirement in a sufficient manner, even one serious health problem could wipe out your retirement fund and you might find yourself facing the rest of your retirement with serious money problems. Just for your healthcare costs alone it’s a good idea to plan on budgeting at least $15,000 per year for every year of your retirement.

You also need to consider whether there will be expenses when you first retire that you’ll still need to cover such as support for aging parents (with life expectancy figures today, it’s definitely a possibility) as well as college education expenses for kids.

In addition, don’t forget miscellaneous costs which may pop up that we tend to forget. These costs include home repair costs, such as replacing a roof, purchasing another vehicle, etc.

After adding up all of the costs you’ll need to cover during retirement, don’t forget to take into consideration the effects of inflation. Figure on costs today rising an average of about 4% a year for every year you have left until retirement and then some.

Finally, don’t forget to give serious thought to how long you may need to fund your retirement. Quite surprisingly, many people tend to underestimate how long they’ll live and as a result run out of money. Don’t let that happen to you. The best rule of thumb is to assume you’ll live to at least age 90 and calculate for that.

Joe Kenny writes for SelectLoans.co.uk, a UK comparison site, visit us today for information on all loan topics including secured loans and links to leading UK providers.
Our Site: http://www.selectloans.co.uk/

Article source: Expert Articles

Most Recent Articles in Wealth Building category

  • Consider A CTA Managed Fund For Balanced Asset Allocation - By: Dwayne Strocen
    There are many investment strategies for both the novice and sophisticated investor. The CTA managed fund has been overlooked until recently. Now the top performing investments are managed by CTA's and you should consider including these in your portfolio.
  • Compounding Wealth by Capitalizing on Boomer Gender Differences - By: Debra L. Morrison
    Did you know that women are so much better at multitasking than men. Does that mean that women are of the better species? Is there really a difference in the way Men and Women handle money and their finances? Read the article to learn more about boomer gender differences.
  • Property Management Secrets For Reducing Your Costs During the Current Economic Hard Times - By: Trish King
    Investment property owners need to seriously consider cutting costs, especially in this economic climate. I've got some ideas that can be incorporated by most any landlord to reduce expenses immediately and put extra dollars to your bottom line.
  • Conserve H20 and Watch Your Savings Grow - By: Joe Cline
    It is not enough that you are aware of water being a very important resource. You should also be aware that it is a very scarce resource. In some countries, women walk tens of kilometers to fetch clean water.
  • Rates woes prompt housing slump - what is exactly happening? - By: Paul Sharp
    Most of people known that High interest rate caused a fall in housing sector. However, "how does rates woes prompt housing slump? What does international monetary fund say on rates woes prompt housing slump?" are known by less people. This article will give you a deep view of what is happening behine housing slump.
  • Seven Steps to Financial Prosperity - By: Clement Sadjere
    Financial prosperity is a process, which if properly mastered can help turn the fortune of the average individual around
  • The Success of the Barnett Shale - By: Anna Poelo
    How did the Barnett Shale become so successful and how did it pull the economy up?
  • Find Lost Money - By: Crizza Reyes
    For most of us, lost money is what's under the couch, in your coat pocket, on the street somewhere, but there are much larger unclaimed assets out there waiting to be recovered - money in bank accounts you'd forgotten about, paychecks that were never collected, utility and rent deposits, etc.
  • Conceal Your Assets: A Critical Overview - By: Brian Garvin
    Find out the truth with relation to Conceal Your Assets and evaluate if it is ideal for you at this time. Please read our unprejudiced evaluation of Conceal Your Assets.
  • What Is Your 'Money Ceiling?' - By: Doug Allan Dammeier
    Change your 'money beliefs' and money will 'flow' into your life.