How much do you need to retire? Will you continue working after age 65? Do you want to travel during your retirement? These are just a handful of questions that are important for retirement planning. Unlike saving for a home or new vehicle, saving for retirement requires long-term commitment and goal oriented benchmarks. At AbbyBank we want to help you succeed as you save, and offer these milestone marks:
Age 18-25: During this point in your life, you are discovering what you want to do, and how to get there. Focus on creating a solid foundation through a monthly budget, and a designated emergency fund. If your employer offers a 401(k) option, we highly recommend utilizing its potential. by contributing the maximum amount your budget will allow. Always be sure to take advantage of a company matching policy if available
Age 25-35: In addition to your 401(k), we also suggest opening an IRA. This enables you to continue to save for retirement with the flexibility of choosing which financial institution you would like to have the account with. Talk to your financial adviser about the benefits of opening a Traditional or Roth IRA today.
Age 35-45: One of the key aspects of retirement is making sure your money is where you need it when you need it. An experienced financial adviser can help you invest in appropriate stocks, bonds, and other financial strategies. Together you can construct a plan to ensure your risk decreases as you age, and be certain the funds you need are available upon retirement.
Age 45-55: Now is the time to examine your current career path, and determine the age at which you would like to retire. The average age of retirement is 66. Whether you decide to retire later at 72, or earlier at 57, knowing the expected age will help continue the progress of saving for retirement. To easily calculate your current savings projection, this tool can provide the most accurate information to help you make the most informed decision for your specific goal.
Age 55-66: During this time you may begin to qualify for distributions from your 401(k) and IRA. By postponing these distributions, you can continue to save, and work to build your retirement nest egg. Additionally, look into various employment options upon retirement. If you decide to work part-time for enjoyment, it could mean added savings to help you afford extra splurges in the future.
Age 66 and up: Once you have officially retired, you will begin to take distributions from your 401(k) and IRA. While both a 401(k) and Traditional IRA require you to accept funds after age 70 ½ , a Roth IRA can remain untouched until you decide to use the money. Consult your tax adviser to see if a Roth IRA is right for you.
We look forward to joining you on your journey to retirement. Whether it’s in 10 years or 50, it’s never too early to start saving!