Retirement planning – setting out your future  

When most young people enter the workforce, retirement is far from their minds. However, these early years of employment are the ideal time to begin exploring the various types of retirement investments and begin saving money for the future. While the principal investment may be significant, even sizable, it is the accumulation of interest that occurs with long-term investments that grows savings the most substantially. Starting to save for retirement early may seem difficult, but there are many options that allow for an individual to put aside money for the future without straining their life in the present.


Supporting your retirement lifestyle

A major way that the economy has affected retirement plans for people is on the standard of living. As the prices for everything continue to rise, retirement dollars become stretched to breaking point. For most people, retirement means being able to live comfortably, so the starting point for any retirement finance plan should be to calculate a savings goal that allows for a certain standard of living. For the average retiree, a monthly income that equals 75-80% of their current monthly income is usually more than enough.


If retirement plans for the future involve enjoying a home and settling in a community, the amount of expenses per month should be fairly stable and easily calculated, even years in advance. If travel is in the cards, or if taking up residence in a retirement community is desired, then calculation will have to be made for these options. Each path has their pros and cons financially, and the individual will have to make their choice based on sound advice and information from reliable sources, such as Doc Gallagher Advisory, that have the experience and skill to assist in planning a retirement.


Tips for retirement investment

Before settling on any investment strategy, it is necessary to settle on how much money is available to be saved and invested after bills and other essentials are paid for. Daily expenses, travel, and health care are all expenses that may increase during retirement.

Once the cost of a comfortable retirement has been calculated and the amount of money to be saved established, it is time to begin investing.

A 401(k) plan or an IRA is an excellent first step in retirement investment, allowing for a maximum yearly contribution with taxes deferred. Contributions made early have a greater impact on the overall savings due to compound interest.

Stocks are another investment option that should be a part of any diverse portfolio. Stocks generally produce higher returns in the long-term, but are considered higher risk than other types of investments. Stocks may be low, medium or high risk in nature, and most well-organized portfolios will have stock shares from all three categories.


Looking forward to a bright retirement

Planning for a comfortable retirement should begin early on and should involve diverse investments and smart money choices. The economic downturn and lethargic recovery have made many people nervous about investing in the retirement finance market. Though the current economy does present some challenges that may be unforeseen, it is entirely possible to plan properly for a decent and comfortable retirement.



Retirement planning – setting out your future  
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