A record number of Americans hit retirement age this year \u2014 and are marking the occasion by handing in their retirement notices. But for many, their financial future is uncertain.<\/p>\n
In fact an estimated 4.1 million Americans will be retiring every year from now through 2027. It\u2019s a phenomenon Jason Fichtner, executive director of Alliance for Lifetime Income, has dubbed the \u201cPeak 65 Zone\u201d (1).<\/p>\n<\/p>\n
Fichtner notes that unlike older boomers, most of these younger retirees have no pension, \u201cwhich used to help fill the gaps left by Social Security.\u201d<\/p>\n
If you\u2019re among them, it\u2019s understandable if you\u2019re feeling both exhilarated at starting a new chapter and nervous about how you\u2019re going to fund the rest of your life.<\/p>\n
Retirement is a big life transition. It helps to have a solid financial plan and the resources to support it to feel comfortable as you wave goodbye to your working life.<\/p>\n
Here are some ways to prepare for the transition.<\/p>\n
Be sure to use the months leading up to retirement to run some numbers and determine your net worth<\/a>.<\/p>\n Budgeting for current and future expenses will help you come up with an effective withdrawal plan.<\/p>\n For many, the 4% rule<\/a> is a decent guideline. This entails withdrawing 4% of your retirement savings in the first year, then adjusting the amount for inflation in subsequent years.<\/p>\n Depending on your portfolio, this should ensure your retirement savings last 30 years or so. The average American enjoys<\/a> 20 years post-retirement.<\/p>\n Read more: Are you richer than you think? Here are 5 clear signs you\u2019re punching way above the average American\u2019s wealth<\/a><\/strong><\/p>\n If you\u2019ve invested in a workplace pension, look at your individual benefit statement to find out how much you’ll get each month. Married couples may have different choices if an employer offers spousal benefits.<\/p>\n If you\u2019re 65, you will qualify for Social Security. The benefit you\u2019ll receive is based on how much you\u2019ve paid in taxes and whether you choose to collect your benefits early or delay them until after your official retirement age.<\/p>\n The Social Security Administration website offers an online tool<\/a> to calculate how much you could get in different scenarios.<\/p>\n Story Continues <\/p>\n When budgeting for retirement, keep in mind that you may not spend money the way you did while you were working. Maybe you\u2019re close to paying off your mortgage, leaving you with extra funds. Perhaps you want to travel more, increasing your travel costs..<\/p>\n Don\u2019t forget to budget for the long term as well, factoring in things like home renovations to help you age in place or the funds you might spend on health care down the road.<\/p>\n If you\u2019re retiring before you\u2019re 65, you\u2019ll also need to budget<\/a> for health-care premiums before you qualify for Medicare.<\/p>\n In the course of this budgeting<\/a> process, you may discover that you don\u2019t have enough money to sustain you in retirement. If that\u2019s the case, consider boosting your income by continuing to work (e,g., part-time job), downsizing your home (to cash in on equity and save on housing costs) or selling a car you don\u2019t need anymore.<\/p>\n Finances are just one part of your retirement plan. Creating a sense of routine and purpose can help you ease into your new lifestyle, and prevent anxiety and stress.<\/p>\n For example, you can establish a morning routine that incorporates a daily walk and logging into an online writing class. Or volunteer at an animal shelter a few times a week, leaving other days free for relaxing activities like reading or sitting by the beach.<\/p>\n The University of Michigan reports that one in three retirees experience some form of isolation and loneliness, so staying socially active and engaged is essential.<\/p>\n With your budget set, and a daily routine filled with purpose and pleasure, any retirement jitters you have will be replaced with a sense of opportunity in this next stage of your life.<\/p>\n Join 200,000+ readers and get Moneywise\u2019s best stories and exclusive interviews first \u2014 clear insights curated and delivered weekly. Subscribe now.<\/a><\/strong><\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines<\/a>.<\/p>\n Retirement Income Institute (1<\/a>)<\/p>\n This article originally appeared on Moneywise.com<\/a> under the title: I just told my boss I\u2019m retiring this year \u2014 and now it finally feels real. How do I get myself ready?<\/a><\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"A record number of Americans hit retirement age this year \u2014 and are marking the occasion by handing…\n","protected":false},"author":3,"featured_media":364807,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[64,7780,168366,176668,4061,255,696,9593,711,67,132,68],"class_list":{"0":"post-364806","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-dave-ramsey","10":"tag-financial-plan","11":"tag-jason-fichtner","12":"tag-jeff-bezos","13":"tag-personal-finance","14":"tag-retirement-savings","15":"tag-robert-kiyosaki","16":"tag-social-security","17":"tag-united-states","18":"tag-unitedstates","19":"tag-us"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115514785355530705","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/364806","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=364806"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/364806\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/364807"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=364806"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=364806"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=364806"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}