Baby boomers, it is generally agreed will desire something close to the present lifestyle for a comfortable retirement.
Generally the standard of living before retirement will be the standard that will be wanted when you retire. The income needed, to maintain that same lifestyle, will be 80%-100% of your earnings at retirement.
You do not have to be a baby boomer before you begin your retirement plan however. Knowing that the income needed for retirement will be close to what is needed now, to maintain the same lifestyle, means considering retirement planning now. The younger you are when you begin your planning, the more likely it will take a number of different forms and a number of turns before you retire. Read our article -Rework Your Life’s Blueprint for a Stress Free Retirement-.
If you are a baby boomer it is absolutely necessary to plan for retirement now. There are many things to consider, but what you plan for your free time will make the difference between a comfortable retirement and a stressful retirement.
Should you be a baby boomer that wants to travel extensively, you will likely need more income than if you stay close to home, volunteering and pursuing hobbies. Consider your own personality and what gives you satisfaction now. Try to estimate your annual expenses during retirement as closely as you can, knowing that your plans may change later.
Begin your retirement plan by asking yourself this question. Where am I, financially? Make yourself a detailed list of your financial assets, such as your bank accounts, investments, IRA, 401(k), etc. On the other side of the ledger you’ll want to list out all your obligations – mortgages, home equity credit lines, car loans and other debts. This should be reviewed periodically so you can follow your successes.
Baby boomers, as you get closer to retirement years you may want to consider consolidating as many of your accounts as you possibly can within just one company. This will help you get a clearer picture of your overall situation, and it may even help you reduce some of the maintenance fees and make it easier to calculate required minimum with-drawls you will have to take once you reach a certain age. Try to have mortgages, home equity credit lines, car loans and other debts paid off or at least reduced to a minimum.
There are likely a number of competent people in your area that can help you with your financial planning. There are a number of web sites online that have good financial information, from numerous sources, to help baby boomers with their financial planning as well.
When you see people enjoying a comfortable retirement you can be pretty sure it all did not happen by accident. When you see folks traveling, working their hobbies, volunteering, enjoying a new career, etc. rest assured, they planned for it, they planned what they wanted for their leisure time activities.