Knowing how much you need to retire is a matter of looking at how much you plan to spend on a yearly basis. One of the best methods for doing this is looking at your current spending. How much money do you need to live comfortably every year?
Along with this baseline, a typical procedure is called the 80% rule, which states that you should be prepared to spend 80% of your current salary every year of your retirement.
This rule accounts for a couple of important factors:
That said, this base guideline does not account for Social Security. We’ll also want to determine if any of your retirement plans could increase your fiscal needs.
A common example is travel, but it can also include things like moving to an expensive area or choosing to join one of Palm Beach’s many exclusive beach clubs. We take everything into account when determining what your fiscal needs will be during your retirement.
Although you can always find ways to prepare for your retirement, it’s best to hire an accountant who can help you navigate the options that best suit your needs. Besides opening a Roth IRA, consider exploring other options that include a savings account, taxable investment account, or traditional IRA.
Conversely, some people choose to retire much earlier, especially if they went through a plan like FIRE. Others may want to delay their retirement to ensure they have sufficient funds, or even simply because they enjoy working.
If you’re unsure when you want to retire, we’ll come up with a financial plan that is aligned to your needs. If you have a good idea of your fiscal goals, we’ll use our experience and expertise to come up with a plan to help you get there.
Legacy Financial Partners has you covered. We’re a team of financial experts who are committed to ensuring you get the retirement you need and deserve. We understand that every individual is unique, which is why we take the time to get to know you and gain a deep understanding of your situation.
At the same time, family defines much of what we do, which is why we’re so committed to helping you leave a legacy behind. Whether you have additional questions or you’re ready to get started on your financial journey, please don’t hesitate to contact us today.
