Retirement: Planning For Your Financial Future

         Retirement not only requires you to prepare for your financial future, but it also requires personal and psychological preparation as you ease out of the workforce and into a new, leisurely lifestyle. Arriving at this momentous milestone in life should be something to look forward to, not dread due to insecure finances or poor preparation. When asking yourself the question “Is it time for me to retire?”, there are a few things to consider before quitting your commute and hitting the beach. 

3 Questions to Ask Yourself

          According to investment counselor Larry Hungerford, there are three questions all future retirees should ask themselves:

1. How satisfied am I with my job?
2. I know what I am retiring “from,” but do I fully understand what I’m retiring “to”?
3. Do I have enough sources of retirement income to fund my “vacation forever” lifestyle?

Job Satisfaction

           A lack of job satisfaction is certainly one of the most common reasons why people consider retiring. Overwhelming schedules, inflexible due dates, and poor management are all contributing factors that makes retirement look like a necessary emotional escape. Some individuals, instead of leaving the workforce entirely, decide to start their own dream business or find a job that better fits their needs as they grow older. No one wants to spend their life miserable at a job they take no pleasure in. Look at retirement like a fresh start--a new chapter just waiting to be written. 

What Are You Retiring To?

           The abrupt shift from a daily schedule filled with activity and purpose to one of simplicity and relaxation can oftentimes create a sense of uselessness and boredom. Without a daily sense of purpose usually provided by one’s work, retirement may appear shallow and unfulfilling if not properly filled with hobbies, travel, education, and both spiritual and personal growth. To get the most out of your retirement, invest your newfound time in seeking out new experiences and creating lasting friendships. 

Establish Realistic and Personal Financial Goals

          Preparing your finances for retirement is not something to take lightly, so take ample time to carefully plan out your financial future. The average retiree should have a retirement income worth at least 75%-80% of his/her original income they received before retirement, though more is highly encouraged. Furthermore, it is suggested to retirees to save three times their average annual salary by age 40, six times by age 50, and eight times by age 60, and ten times by age 67. In terms of retirement spending, Wealthfront provides an interesting calculation.