Make Your Golden Years Truly Golden: Saving for Retirement

There are a number of both positive and negative attributes to growing older and reaching retirement age. On one hand, there’s an amazing amount of free time to pursue hobbies and leisure interests, without the pesky necessity of having to be sitting at a desk for eight hours each day, five days each week. On the flipside of that is a feeling of being lost without the regularity of work, and also worrying that your retirement savings will give you a comfortable quality of life without the security of a regular income. Some professions don’t really seem to need retirement- Judi Dench played M, James Bond’s wonderfully brittle boss until she was 78, and Cher continues to enjoy chart success, gyrating with backup dancers young enough to be her grandchildren, and she’s 67 years old. But what about the rest of us? There are so many factors to consider when it comes to saving for the retirement years, and some of us are fortunate enough to be in a higher salary bracket, which can potentially mean there are additional funds available to stash away for the future. Let’s look at a few different tricks and tips to ensure that everyone’s golden years are well and truly golden.

When Should I Start Saving?

Residents in some countries have it slightly easier when it comes to saving for retirement. The Australian Superannuation scheme requires employers to start a compulsory retirement fund for staff, on top of their regular salary, and that’s in addition to any voluntary payments. In other countries, the onus is on the employee to start saving for retirement of their own accord, making them less reliant on government funding once they reach retirement age, and also giving them a better quality of life. So when should you actually start saving for retirement? Ideally, you should have already started…

How Much Will I Have?

There’s not really a lot of room for error if you don’t save enough for retirement. A 20 year old who begins saving for retirement now, saving approximately 6% of their salary per week, considering the US median income of $51,017 and adjusting for inflation, will end up with around $371,000 in savings if they were to retire at the age of 65. Not to be morbid, but taking into consideration a life expectancy of 87 years, this allows for a maximum of $445 per week. This is not a tiny amount, but still falls well below what most of us would consider to be comfortable. Is it any wonder that some members of the community are deciding to delay retirement by several years?

What About If I Want to Save More?

Saving even 6% of a salary can be difficult, which is why the 401K can be invaluable, with the employee contributing 3%, and their employer matching that amount. The somewhat frustrating thing about the 401K is that you’re not necessarily able to make as many additional contributions as you would like, since the amount is capped at $17,500 (pre-tax) per year. In Australia, it’s a more generous $25,000 (approximately USD $23,000). Having said that, making additional retirement contributions, even one or two percent more per pay cycle can make a huge difference.

What About Investing?

There used to be some fairly traditional methods of accumulating wealth, with real estate and property ownership previously being seen as a safe bet; an investment that would continue to appreciate in value. Thanks to the global financial crisis and increasing rates of poverty, this is no longer the case, and it’s the same with relatively safe stocks and bonds that used to be viewed as a valid means of slow and steady wealth accumulation. Indeed, some Individual Retirement Accounts (IRA) had so much wiped from their value that there was less than $30,00 left- a terrifying prospect if you’re reaching retirement age. Moreover, take guidance of Your Personal Financial Mentor at every step to achieve your financial goals successfully because he has the required knowledge and expertise of the market.

Make the Golden Years Golden

There are still some means of investment that can return a tidy profit, and these are so obvious that some of us might not even think about them. Investing in gold is a sound choice, as it’s one of the few things that are practically guaranteed to grow in value. You can certainly privately use some of your retirement funds to purchase gold bars, but utilizing the help of a gold IRA rollover can ensure that you receive additional tax benefits, which leaves you less out of pocket than a private transaction. It’s not as though you’ll have a pile of retirement gold waiting for you in a Swiss bank vault, but gold is something that more and more people are turning to in order to boost their retirement savings. And let’s face it; gold is a more comfortable wealth builder than trying to launch a music career as a direct competitor to Cher.

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December 3, 2013 Make Your Golden Years Truly Golden: Saving for Retirement