How to Calculate for Retirement
If you are member of the baby boomer generation, you are looking forward to those retirement years. If you are a son or a daughter of a baby boomer, start to calculate now for your retirement.
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Instructions
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How to Calculate for Retirement
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1
Understand your financial future. Retirement is expensive and you will have to make adjustments to your current life style in order to retire. Understand that when you retire, you will be losing approximately 30% of your take home pay. Start planning how to adjust to this new life.
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2
Contact Social Security as soon as possible for a free Personal Earnings and Benefits Estimate Statement. Your Social security benefits is about 40% of your pre retirement earnings. You will need at least 70% to live comfortably.
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3
Contribute to tax sheltered savings plans, if your employer offers a tax sheltered, 401K. Those are pre tax dollars, so put the maximum in. Check with your employer to see how much he will match towards your retirement funds. Every penny counts.
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4
Actively engage in setting up an Individual Retirement Account. Delay paying taxes on investment earnings until you reach retirement age.
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5
Keep your hands off of your retirement savings. If you start tapping into the retirement savings you will lose principal and interest.
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6
Begin putting money away as soon as you start working, The earlier you start to save, the more that you will have for your retirement.
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Communicate and ask questions of your employer and human resource office. What plans does your company offer? How do you enroll? Wwhat percentages are you allowed to allot and what percentages are they willing to match?
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8
Assure that you can afford to retire. The year before you retire, cut back on your living expenses by at least 25%, if you can successfully enjoy life at that level then you will be able to retire in comfort.
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Tips & Warnings
Plan ahead, start to put your money away as early as possible
Do not touch your retirement funds, they are there for a reason. You do not want to have to get a job flipping burgers at your local McDonald's just to make ends meet
