Retirement is the biggest financial responsibility most people will face in a lifetime. Other than raising children, few things rival the effort you must put into planning for a financially sound retirement. This responsibility is often so big that many people avoid it. They hope that Social Security will cover their needs and otherwise avoid the topic of retirement altogether because it feels too big to manage.
Many Americans see their retirement outlook as a place of financial insecurity. Almost everyone feels as if they haven’t done enough, or they don’t know if they’ve saved and invested enough to cover their needs. But, with the help of your OneAscent advisor, you can tackle the problem of retirement with confidence and get on track toward a stable retirement goal, regardless of your current situation.
Retirement Goals by Age
Retirement planning is a journey, not a single step in your overall financial plan. It is one of the biggest savings goals you’ll ever have, so it’s important to take it step by step. By setting smaller goals with the help of your advisor, you can feel more confident that you’re doing enough for your long-term retirement planning.
Most retirement planners say you should plan for retirement savings by your age. A general rule of thumb to follow is to have the following savings by each decade of your life:
- Age 30: One year equivalent to your salary
- Age 40: 3xs your salary
- Age 50: 6xs your salary
- Age 60: 8xs your salary
- Age 67 (or your retirement goal age): 10xs your salary
You want to have at least ten times your annual salary by your retirement age. This may be 67, or it may be later, depending on how much you still need to save and how active you want to stay in later years. However, this plan can always be adjusted to your specific needs, goals, and vocation to ensure you’re leading a happy life before and during retirement.
What does the Bible say about retirement?
Other Benchmarks of Retirement Readiness
Retirement planning isn’t just about hitting a certain savings amount before your retirement age. It’s crucial to build a holistic and sound financial plan that will account for multiple needs and goals in your retirement years, such as:
- Lowered expenses by paying off major debts (such as your home and cars)
- A medical plan in place for both current conditions and unexpected medical needs
- A financial legacy plan, including an inheritance or trusts for your family and loved ones
- Investments that can generate passive income to supplement your savings
These factors make retirement planning more complex and should be discussed with your OneAscent financial advisor. They can help you accurately calculate your retirement savings needs, and help you choose investment strategies aligned with those needs.