Posts

Myths and Facts about Social Security

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Myth: Social Security will provide most of the income you need in retirement. Fact: It's likely that Social Security will provide a smaller portion of retirement income than you expect. There's no doubt about it--Social Security is an important…

Retirement Income Shortfalls

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If you're lucky, your expected income sources will be more than enough to fund even a lengthy retirement. But what if it looks like you'll come up short? Don't panic--there are probably steps that you can take to bridge the gap. A financial…

3 new realities of retirement

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3 new realities of retirement Think about your parents' retirement for a minute. Their lives most likely look a whole lot different than their parents'. Your grandfather probably stopped working the very day he turned 65. He and your grandmother…

Identify your sources of retirement income

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Once you have an idea of your retirement income needs, your next step is to assess how prepared you are to meet those needs. In other words, what sources of retirement income will be available to you? Your employer may offer a traditional pension…

Estimate your life expectancy

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The age at which you retire isn't the only factor that determines how long you'll be retired. The other important factor is your lifespan. We all hope to live to an old age, but a longer life means that you'll have even more years of retirement…

Decide when you'll retire

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To determine your total retirement needs, you can't just estimate how much annual income you need. You also have to estimate how long you'll be retired. Why? The longer your retirement, the more years of income you'll need to fund it. The length…

Don't forget that the cost of living will go up over time.

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The average annual rate of inflation over the past 20 years has been approximately 3 percent. (Source: Consumer price index (CPI-U) data published annually by the U.S. Department of Labor, 2009.) And keep in mind that your retirement expenses…

Project your retirement expenses

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Your annual income during retirement should be enough (or more than enough) to meet your retirement expenses. That's why estimating those expenses is a big piece of the retirement planning puzzle. But you may have a hard time identifying all…

Use your current income as a starting point

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It's common to discuss desired annual retirement income as a percentage of your current income. Depending on who you're talking to, that percentage could be anywhere from 60 to 90 percent, or even more. The appeal of this approach lies in its…