How Much You Should Save for Retirement

January 17, 2023

How much should you save for retirement, and can you save enough to live comfortably when you retire? Like most financial goals, saving for retirement is often a challenge. Setting aside money every month demands discipline and consistency — not to mention the financial ability to budget for savings. It’s no surprise that many people struggle to save for retirement. You can jumpstart your retirement savings by assessing how much you need to save.

What To Do to Save for Retirement

If you are curious about how much money you may need for retirement, check out the following four factors to get started on your retirement planning strategy.

Plan Your Retirement By Considering Your Expenses

The first step toward budgeting for retirement is considering your overall expenses. Take a look at your monthly budget for food, utilities, entertainment, and other costs to see what you need to live comfortably. Calculating this figure will help you understand the bare minimum you need to save for your monthly income once you retire.

Assess Your Long-Term Living Expenses

There’s a good chance that your living expenses will change when you retire. For many people, this means that these costs will increase. Expenses such as travel, medical bills, and shopping may trigger a spike in your spending. Long-term care is another potential culprit for rising costs. Whether you plan to age in place or move to a senior-friendly residence, you must account for the increase in costs that will likely emerge. Budgeting for these new costs can reduce the threat of financial strain later in life.

Take Healthcare and Insurance Expenses Into Account

It’s essential to account for the potential expense that healthcare and insurance will impose. Medicare premiums have been rising steadily, and this expense can put an undue strain on your retirement budget if you don’t plan ahead. Even if you have health insurance, healthcare costs typically increase as you age, so budgeting for these costs is essential. According to one report, the average annual healthcare spending for people between 65 and 74 is $13,000. Saving enough to cover this expense will ensure you have access to the necessary care.

Build Savings and Enjoy a Comfortable Retirement

Planning for retirement means you need to project your expenses and account for the potential of increased costs. Then, once you understand the expenses, you can calculate a monthly savings goal and start working toward a comfortable retirement. You can grow your savings further with retirement investment accounts such as a 401(k), Roth IRA, or another retirement plan that best suits your needs. A plan like this can help you save on taxes in some cases, too. Discover all your options for retirement saving and planning so that you can look forward to a bright future.

About 1891 Financial Life

At 1891 Financial Life we don’t just sell policies, we offer possibilities. We pride ourselves on giving back to the communities that we serve by providing quality and comprehensive insurance solutions. We are a not-for-profit life insurance Society, which means the sales from these financial service products help fund member benefits along with social, educational, and volunteer programs designed to respond to community needs.

Our portfolio is extensive, ranging from various life insurance policies to our MYGA to support your financial needs no matter what stage of life you’re in. For more information, contact us at (855) 804-7424.

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