Retirement Planning

Retirement planning

Retirement planning

Retirement planning is an important financial goal for looking a comfortable future before you get a semi title loan. Most workers want to be financially independent and have a comfortable retirement.

Although most workers are eligible for social security benefits, for average income workers, social security retirement benefits will replace only about 43% of their gross earnings in the year prior to retirement. Thus, most retired workers will need additional income just to maintain their present standard of living during retirement. You can obtain additional income by having a separate retirement program and, if available, by participating in a private pension plan sponsored by your employer.

Although retirement planning is important, many workers are not saving enough to retire comfortably. A study by Merrill Lynch showed that the baby boom generation (those born between 1946 and 1964) has saved only about 35% of the amount needed just to maintain the standard of living in retirement that they have attained during their working years.

In addition, the amount of financial assets accumulated by older workers on the threshold of retirement is relatively small, especially for minority workers. The Rand Corporation analyzed the amount of financial assets owned by older households and individuals ages 51-61. The study showed that in 1993, the median amount of financial assets owned by middle-aged white households was only $17,300. For middle-aged blade households, the median amount of financial assets owned was only $400, and for Hispanic households, only $150 these amounts are small. Thus, any supplemental retirement income will also be small. As a result, such workers will likely be faced with a reduced standard of living after retirement.

The preceding data show that many workers are inadequately prepared for retirement. Saving for retirement should receive greater emphasis in a financial plan even if the amounts saved are relatively small. Because of the powerful effect of compound interest, small amounts saved regularly can accumulate to substantial; amounts over a long period. For example, if you save and invest only $10 monthly in a growth stock mutual fund in a tax-deferred retirement plan and earn an average annual return on 10%, you will accumulate more than $22.000 at the end of 30 years then you can get an Atlanta car title loan.

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