More Americans are retiring earlier than previous generations. According to a survey by the Federal Reserve Bank, their odds of retiring before age 62 rose to roughly 50% in July 2021, partly due to the pandemic. For many, moving up their retirement seemed like the right choice given the state of the labor market and economy, but many were not and are still not financially prepared to retire.
According to a 2022 retirement confidence survey from the Employee Benefit Research Institute, one in three workers are “not too” or “not at all” confident they will have enough money to live comfortably throughout their retirement.
Are you confident you will be able to retire with your basic expenses covered and enjoy the post-work life you’ve imagined? Check these three things.
Define Your Goals
After decades spent working, the prospect of retirement can feel sudden, and some people may have difficulty envisioning what it will look like. When you picture your retirement, what do you see yourself doing? Traveling abroad and checking cities off your bucket list? Paying for your children’s or grandchildren’s weddings? Setting up a legacy fund for your loved ones?
If you don’t yet know what you want out of retirement, start thinking now. Without clear goals, you won’t know how much money it will take to reach them. Beyond your core living expenses, consider how you would like to spend your time during your “go-go” (the first 10 years of retirement), “slow-go” years (middle retirement), and beyond.
See Where You Stand
Now that you have defined your goals, it’s time to see how your savings, investments, retirement accounts and other assets can support your desired retirement lifestyle. An easy way to check your retirement readiness is to use an online platform like Prudential Stages for Retirement.
This digital tool will take the information you share about your current financial life and retirement goals to determine your personal “confidence score,” which indicates your retirement readiness. In a few steps, you will have a clearer picture of your retirement based on how you are saving and investing today.
Speak With An Advisor
Once you have a clearer view of the big picture, you can meet with a financial advisor to help map out a step-by-step financial plan. If you do not have a financial advisor, you’re not alone.
Millions of Americans do not have a financial advisor. Some do not because they don’t know how to find someone they trust. Still others may feel an advisor is not for them, mistakenly thinking they need a certain level of wealth to engage a professional’s help. However, establishing a relationship with a financial advisor can help you confidently plan for a better retirement and even give you an edge.
Enlisting the help of a financial advisor can make planning for retirement easier and grow your wealth so you can achieve your retirement goals instead of having “just enough,” or even not enough.
Through Prudential Stages for Retirement, you can set up a meeting with a noncommission-based financial advisor who will recommend strategies and products that can help you reach your retirement goals. You do not have to be an existing Prudential customer. To learn more and get started, visit Prudential’s Retirement Calculator. (BPT)