Top 10 Recommendations for Retirement Planning
The thought of planning for retirement can be exciting and a little scary, the main question being, “How much money do I need to retire?” To ensure you’re properly prepared when the time comes, here is what financial experts recommend when planning for retirement.
Start Saving Now – It’s never too early, and small amounts add up over time. Create a savings plan and stick to it.
Estimate Retirement Savings – Aim to replace 70-90% of your pre-retirement income so you can maintain your lifestyle.
Invest in Your 401(k) – Contribute regularly. Employers often match anywhere from 25-100% of employee contributions, and tax benefits make 401(k)s a smart move.
Understand Pension Plans – If offered, review your benefits and know what happens if you change jobs.
Learn Investment Basics – Inflation and the different types of investments can affect your savings. Learn your options and ask questions.
Ask for a Retirement Plan – If none exist, suggest one. There are options that can benefit both you and your employer.
Open an Individual Retirement Account (IRA) – You can contribute up to $6,500 annually (more if you’re 50+). They also provide tax advantages.
Avoid Early Withdrawals – You’ll lose money on interest and face penalties. When you change jobs, roll the funds over into an IRA to avoid taxes being taken out.
Learn About Social Security – It may replace up to 40% of income, but your benefits depend on earnings and retirement age. Relying solely on Social Security for retirement is not recommended.
Stay Curious – Keep asking questions. Staying informed helps you to make better financial decisions.
The Three R’s of Retirement
Resiliency
The ability to stay calm and adaptable when money gets tight – always pushing forward with a positive mindset.
Resourcefulness
Using creativity and smart thinking to make the most of what you have and stretch every dollar, save every dime.
Renaissance Spirit
A love of learning that fuels your financial growth – staying curious, always improving your money skills.
The 3% Retirement Rule: Experts recommend withdrawing 3% of your 401(k) during your first year of retirement. The lower your withdrawal rate, the more your retirement corpus can grow at a potentially faster rate – creating a safety net when unexpected expenses or market downturns happen.
Meet the Author
Abby Callahan, BA
Abby Callahan is a graduate of the University of Tennessee at Chattanooga (UTC), where she earned a Bachelor of Arts in English with a minor in Spanish and the distinction of Cum Laude. She also graduated Magna Cum Laude from Chattanooga State Community College, earning honors through the Global Scholars Honors Program. Prior to joining CMC Media & Marketing Group as editor/digital content specialist, Abby successfully fulfilled roles in marketing and event planning, as well as strategic communications and storytelling for a wide variety of initiatives. Today, Abby leads ideation, conceptualization, and development of numerous health, wellness, business, sports, and lifestyle articles published in print and online for HealthScope®, CityScope®, and Choose Chattanooga® magazines – premier publications serving S.E. Tennessee and North Georgia.
