Thursday, October 28
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Ready, Set, Retire! Preparing and Enjoying Your Retirement Years

Ready, Set, Retire! - Blog | Parsec Financial

The average age of retirement across the United States ranges from anywhere between 61 and 66. The actual age differs per state, obviously due to several factors. Instead of viewing retirement as the end of things, one can take the more pleasant road and take retirement as the golden opportunity to enjoy the fruits of a life’s worth of toil.

The so-coined FIRE movement (Financial Independence, Retire Early) is growing in popularity. Its popularity might speak to most, if not everyone’s, dream to finally enjoy “the easy life.” Of course, though, to truly enjoy a comfortable retirement takes more than just dreams—it requires actual preparation.

How Much Savings Do You Need for Your Retirement?

On average, a good nest egg for retirement ranges between $700,000 and $1 million in the United States. Realistically, the amount of money you need to set aside for your retirement depends on which state you live in, due to variances in per-state cost of living.

Banking consultants calculated the annual expenditures (after deducting social security income) for a retired person in every state. They found that residents of many southeastern and southwestern states like Mississippi and Oklahoma require less than $700,000 in savings to retire. Residents of northeastern states aren’t as lucky as they might need to put aside at least $1 million for a comfortable retirement.

Where Can You Put Your Retirement Money?

For those who are thinking of starting now, know that you typically have three options when investing for your retirement:

  • Employer Retirement Account: You can put the money into a 401(k) plan or 403(b) plan. These financial plans are widely popular because the money will grow tax-free until you withdraw it for your retirement.
  • Individual Retirement Account: An IRA is a savings account eligible for substantial tax breaks. IRAs offer similar tax breaks as 401(k)s, with some eligibility differences.
  • Regular Investment Accounts: You can opt to invest your money with the more generic insurance providers or banks offering retirement savings plans. Unlike 401(k)s, IRAs, or 403(b)s, these regular investment accounts might not have tax advantages, though.

The first two options are far better deals, just that there are limits to how much money you can put into them annually. If you’ve reached the threshold with the tax-favored plans and you still want to save even more, you’ll have to use a regular investment account.

Things You Can Do When You Retire

Now that you’ve retired, you have all the time and money in the world. So what next? Here’s what you can do when you do decide to take it easy:

  • Travel the World: Retirement means unlimited vacation time, so take extended vacations to your dream destinations. Take a long, leisurely cruise or even live in a foreign country for a while.
  • Move to the Country: Now you can put some distance between you and the city’s traffic, noise, and costs. If foreign living is not your cup of tea, move out to the country. Use your new space to start an orchard, an animal farm, or even a vineyard.
  • Reconnect: Spend more time visiting with family and friends, both across town and across the country. Get back to and explore your roots: find old friends or find relatives you never knew you had.
  • Start a Business: Now that you have bid farewell to your career, it’s the best time to start that business you’ve always wanted but never had the time for. Consider capitalizing on your career experience and create a consulting firm. If you have an existing part-time business, you can grow it into a full-time venture.
  • Volunteer: Get with your local church or pet charitable organization and ask about volunteer opportunities suitable for your skills and conditions. You can take volunteer assignments off-state or overseas, too.
  • Teach: Utilize the wisdom of your years and experience to teach others. Mentor someone. Start a free course at your local community center or library. You might even want to teach at a nearby community college or university.
  • Take Care of Yourself: Read. Babysit your grandchildren. Devote more time to your hobbies or take up new ones. No matter how much money you’ve successfully set aside for your retirement, none of it matters if you do not have the well-being to enjoy it. You can even consider settling down and savoring the comfort of a senior living facility if what you desire is a quiet, enriched life without having to exert yourself much.

 

If you can put money aside for your retirement, you can genuinely say that you earned your retirement. The next challenge is to make it last. Even if you can put aside more than is necessary, there is still wisdom in living within your means. And if you have a fixed income or monthly pension from your savings, draw up and stick to a budget.

Meta title: Set Aside Enough Money for a Comfortable Retirement
meta desc: A few tips on how to start setting money aside for one’s retirement as well as how to spend the retirement years comfortably.

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