Ever wonder if you’re saving enough money for retirement? Even if you’re in your 20’s, most experts say you should be saving 10-15% of your annual income each year! Setting aside a little bit every month can be a hard thing to do, and even when you’re doing all the right things, it’s still hard to feel confident about it. Should it sit in a savings account, 401K, or should you invest it some other way? There are so many questions with so few definitive answers!
So, how can you tell if you’re on the right track? An article from Fool.com titled, How Much Money Should You Save Every Year? Our Retirement Experts Weigh In, gives some great advice and tips to help you figure out if you’re on the right track. We’ve listed some of their great points below:
1) By the time you’re 35, you should have a savings equivalent to your annual salary. So, if you make $80,000 per year, you should have at least that in your savings account(s). If you’re under 35, are you on the right track for that? Or, think back to when you were in your 30’s, was this the case for you?
2) By the age of 45, you should have three times your annual salary. By the age of 67, a person should have at least eight times their annual salary to retire comfortably, depending on their lifestyle.
3) Listen to the savings advice that professionals are giving! The National Institute on Retirement Security recently reported that the average retirement-aged American Household has $100,000 in savings – nowhere near the suggested advice of eight times the annual salary ($52,000/year)!
3) When saving for retirement, you should start as early as possible! According to a Forbes analysis, if you start in your 20’s you can save 10%-15% annually to reach enough for retirement. However, if you start in your 30’s that percentage goes up to 20.1%, and if you wait until your 40’s, it jumps all the way up to 43.2%!
4) Even if you don’t make very much money, the best way to save is it get in the habit of saving. Set up another bank account to automatically transfer a certain amount of money each month. This will take the pressure off of you to physically do it, and you won’t be able to spend money that isn’t as easily accessible to you in your primary checking account.
So, visit the link below to read the entire article containing all of the expert advice and ask yourself if you’re setting yourself up for retirement savings success. If you are, great job! If you aren’t, recalculate, adjust and make some changes; it’s never too late to start to make a positive change in your life!