When making arrangements for monetary needs in retirement, the most pressing question remains the same: how much money is enough? While there already isn’t any one-size-fits-all answer to that question, the recent announcement of solvency in Social Security has only added to people’s anxieties.
According to a Transamerica Center for Retirement Studies survey, 73% of employed professionals believe that their Social Security will provide no benefits when they’re ready to retire. Additionally, a Nationwide survey discovered that 71% of Americans believe that their Social Security provisions would run out in their lifetime.
With all these uncertainties up in the air, experts suggest that it’s best to start building your retirement income up in other ways.
Step 1 – Have a Plan
As simple as this may sound, at the end of the day, it’s absolutely legit – what can you do without a plan? According to the president of Covisum and certified financial planner Joe Elsasser, most people don’t have a plan.
And if there’s no plan, how can there be a stable future? He advises that you start with assessing whether your Social Security benefits. Are you on the right track? If cuts were suddenly imposed, how would that affect your benefits?
Step 2 – Safeguard Your Income Streams
Whatever changes are now made to Social Security benefits are unlikely to affect near or current retirees. However, younger generations might definitely feel a pinch from the changes.
Elsasser also adds that if you’re in good health and are approaching retirement, it’d pay off to delay claiming benefits for a couple of years. Depending on your full retirement age, to-be retirees could potentially be foregoing about 25% to 30% of retirement income by withdrawing their checks too early.
Step 3 – Consider an Annuity
Elsasser states that one can acquire the best annuity money can buy if they delay collecting their Social Security benefits until they hit the big 7-0. For people who don’t have substantial guaranteed retirement income, annuities can act as a great supplement to Social Security. If you use this asset correctly, it could potentially substitute as a pension in your old age.
Wrapping It Up
Perhaps one of the biggest worries in adult life is gathering sufficient sums to live out retired life with complete peace of mind and a gold pot large enough to last even after you’ve bitten the dust. To accomplish this, you might have to stop relying on the government and take matters into your own hand. After all, the maximum you could hope to collect every month from the government is a little over $3000.