Studies have consistently shown that the majority of Americans have no idea how much they need to save for retirement. Most use an arbitrary round number, such as $1 million, as the amount they require for a retirement nest egg. While having a random savings goal is obviously better than none at all, finding a more accurate retirement number doesn’t have to be complicated, according to Motley Fool.
The truth is that how much you’ll need for retirement is unique to you and your family. However, many people gain confidence in their plans to retire whilst actually planning in order to know what to set aside for daily expenses, healthcare, and recreation.
Failing to plan, is planning to fail
For retirement planning support and support over the course of your retirement, consulting a financial advisor has been shown to be a positive option. Voya Financial, in a study, found that 79% of people who use an advisor said they “know how to pursue achieving their retirement goals.” The study also found that 59% of those who use an advisor have calculated how much they need to retire, while 52% established a formal retirement investment plan.
There’s no way to accurately project exactly how much you’ll need to save and invest for retirement, but it’s a smart idea to err on the side of caution and aim to exceed your retirement number. After all, the last thing you want is to be 85 years old and running out of money.
References:
- https://article.smartasset.com/4-key-steps-for-retiring-comfortably
- https://www.fool.com/retirement/2016/10/09/the-simple-way-to-find-your-retirement-number.aspx