Having a plan for retirement is crucial for everyone. People should start thinking about their retirement even as early as their 30s. The sooner individuals start saving, the better off they will be when approaching the age at which they plan to retire. The amount received from Social Security benefits and other possible sources of retirement income will not likely cover all of a retiree's expenses.
The Social Security Administration has a calculator that provides an estimate of a person's retirement benefit by accessing the actual earnings record. The calculator can be found at: http://www.socialsecurity.gov/OACT/anypia/anypia.html.
The first step to begin planning for retirement for individuals is to estimate how much money will be needed to live the lifestyle they would like to during their retirement years. Setting realistic and specific goals will assist in determining a budget and help individuals stay on track. It is important to keep in mind that health care expenses will most likely rise during retirement years, as well.
CNNMoney.com's series Money 101 has a section focusing on retirement and can be a useful resource. They have developed a retirement savings calculator to let people know about how much they will need to save to meet their goals during retirement. The calculator can be found at: http://cgi.money.cnn.com/tools/retirementplanner/retirementplanner_101.jsp.
Investing in a 401(k) is one of the easiest ways to save for retirement. Money contributed to a 401(k) is not taxed because contributions are taken out of a paycheck before the taxes are withheld. Another benefit is that many companies will match some or all of an employee's contributions to a 401(k), so it is free money.
Contributing to either a traditional Individual Retirement Account (IRA) or a Roth IRA can also offer tax breaks. A good resource for more information on investing in retirement accounts is the Internal Revenue Service's website at: http://www.irs.gov/Retirement-Plans?navmenu=menu1.
If they are healthy, some people choose to delay retirement past the age of 62 or continue to work part-time in order to receive a larger benefit from Social Security. According to the AARP, the benefit increases by about 6% a year for every year filing for benefits is delayed. The AARP is a nonprofit and nonpartisan organization with the mission to help those who are over the age of 50.
It is never too late to start planning for retirement. Every little bit of strategizing and saving will help people live fuller and richer lives as they reach their retirement years.
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