5 Rules to Achieve the Retirement Lifestyle You Want

Approximately half of Americans have no retirement savings at all. Many young Americans don’t focus on retirement in their 20s, although starting early is still the best retirement strategy.

According to Fidelity, here’s how much you should have saved at each age:

• By 30, you should have the equivalent of your annual salary saved
• By 40, you should have three times your salary saved
• By 50, you should have six times your salary saved
• By 60, you should have eight times your salary saved
• By 67, you should have 10 times your salary saved

If you are not yet where you ought to be with retirement savings, here are some helpful rules that could help you get on track:

1. Track your income and spending habits. Put a plan in place to spend less than you earn.  Solvency is a simple equation – if you spend less than you earn you can put money aside for the future. It’s simply a case of shifting your focus from living in the here and now to thinking about your long-term future.
2. Aim to be debt-free when you retire. This is a natural follow-on from the first rule.  Don’t buy on credit. And get rid of any debt you already have since the interest is money you’re paying in excess of what the purchase actually cost.
3. Take advantage of retirement plans. If you’re employed, contribute to the company plan – 401K or other retirement options. If you have your own business or you’re opting for the gig/freelance lifestyle, there are other options – an IRA (traditional or Roth), a Solo 401(k), a SEP IRA, a SIMPLE IRA, or a defined benefit plan.
4. Diversify your investments. “If you want to be wealthy by the time your retire, you need to diversify your investment,” says Lawrence Merl, Senior Vice President, Investments for David Lerner Associates. “Work with an advisor who can explain all the options and put your funds into what we call the sensible middle ground of investing.”
5. Ignore the financial ups and downs. Remember, you’re in this for the long haul. If you chase every shiny new investment idea, you will likely not achieve the goal. Just follow your advisors’ advice and stick with the plan. By the time you’re ready to retire, you’ll have the necessary funds to enjoy your golden years.

 

It is possible to plan for a happy and financially secure retirement. Just follow these 5 basic rules. Start as early as possible and when you retire, you’ll be financially secure.

 

 

IMPORTANT DISCLOSURES

 

Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable– we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances.

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