One of the most important things you should be doing with your money is saving it. It might not sound as fun as going out and splurging on food, clothes, and travel, but retirement savings are an important aspect of a budget. Many people have not done any research about retirement, and even those who are saving do not know all there is to know about retirement. Check out these three little known facts about retirement savings below and you might realize it’s time to understand what needs to be done in order for you to retire comfortably.
The majority of your money as a retiree will come from social security.
The vast majority of retirees receive a large portion of their income from social security. In fact, social security payments account for 90 percent of income for over a third of American retirees. Social security payments are often plenty to get you by once you are in retirement, but it’s important to remember that if you want to live a comfortable lifestyle, you still need to have some other plans in place to help round out your funds. There are also concerns that social security money will run out in the next twenty years. You never know what the future will hold, so it’s better to play it safe and prepare more than one type of retirement fund.
Far too often, retirees aren’t using all of the money available to them.
Many people find it difficult to spend the money they have worked towards saving their whole life. More often than you would realize, retirees are afraid to touch most of the money they have set aside for retirement because it makes them feel a sense of loss to spend the money and see the funds going down. Unfortunately, some retirees forget about parts of their savings as well. There are far too many unclaimed pensions in the United States. With millions of dollars out there in unclaimed pensions,many retirees are living on a much tighter budget than necessary.
1 out of 3 US citizens have not started saving towards retirement yet.
Due to the high demands that our society faces today, many individuals have $0 in their retirement fund. It is no secret that our economy has been struggling over the last decade. However, individuals who are struggling to stay afloat due to the economy might be in for quite a shock when they start nearing the age for retirement. Their reasons for not saving are valid, most stating that they cannot afford to save for retirement because they are paying off student loans and credit card bills, but if you are one of the many who have not started saving today might be the time to start weighing your options.
Did you know these facts about retirement? There are many things that American citizens do not know about saving for the future. It’s not enough to put off your plans until you are ready to retire within the next 5 years. The time to start preparing is now. Don’t let your money go to waste, and don’t leave yourself in a position where you will be struggling in your old age and unable to enjoy your retirement years.
Andrew is a corporate finance consultant living in Los Angeles, specializing in distressed and bankrupt consulting. He helps clients review business plans and the general market and decide what steps to take next. He has a masters in finance.
Andrew enjoys running and biking in the San Gabriel mountains, cheering for the San Francisco Giants and eating (but trying not to gain weight).