Retirement Planning

They call them the Golden Years for a reason. You’ve worked hard your whole life, now it’s time to live life by the gold standard. It’s time to kick back and enjoy the fruits of your labor. But to make sure this is how the script plays out, you’ve got to plan ahead. You’ve got to take the necessary steps now to allow for a comfortable lifestyle later.

For a man who took hundreds of punches to the head, former heavyweight boxing champion George Foreman has a pretty clear vision of retirement when he states:

“The question isn't at what age I want to retire, it's at what income.”

This is what you must consider when planning for your post rat race future. But where do you start? There are a couple important steps¹ you should consider when planning for your retirement.

Face the facts.
New life expectancy statistics show up to one-third of your life could be spent in retirement. Most people need to provide adequate income for 25-30 years. That’s a lot of life to live on a fixed budget, and that’s why you need to take a hard look at your financial situation, considering your current age, the impact of inflation on your future expenses, and your anticipated retirement budget.

How will inflation impact your future purchasing power? Check out some of the pricing on life’s necessities in the coming years:

As you can see, you’ll need to take inflation into account when planning for your future. How much money will you need? A rule of thumb is at least 75% of your current income.

What are your income sources?
It used to be a worker could retire fairly comfortably with a combination of Social Security and a workplace pension. In the future, these income streams are likely to become a smaller percentage of a retiree’s income. What makes up retirement income? Here’s a breakdown by percentage:⁵                

Taking the above into account, how do you arrive at the retirement plan that’s right for your needs? Here are a few things to consider:
 

• How much income will you need to live comfortably during retirement?
   
• How much will you need to save to meet your goals?
   
• Select the proper retirement plan that will help you meet your goals.
   
• The sooner you start saving, the better. Save a fixed amount each month.

These are just a few things to think about when considering funding your retirement. Planning your retirement is an important part of your professional and personal life. It pays to have a professional planner on your side. Vantage Investment Service Group can help you plan your future, whether short-term or long-term.

_{1  Franklin Templeton Investments
2  Based on average annual growth rate of 3.1% 1992-2002
3  Bureau of Labor Statistics, Consumer Expenditure Survey, 2002
4  Bureau of Transportation Statistics, National Transportation Statistics, 2004
5 U.S. Census Bureau}