The way New Yorkers approach retirement planning is very backwards. Most individuals do not take the necessary measures to live comfortably after retirement. You’re never too early to start saving towards retirement. However, many people fail to plan properly. In fact, 70 percent of Americans have less than $30,000 saved in these accounts. This is a scary realization because most of these people will not be able to live on this for the remainder of their lives and may possibly become poor in only a few years.
Many people fail to understand how much money they actually need to live comfortably in retirement. To maintain the same living conditions that they have before retirement, people need about 20 times their annual income. However, it varies depending on situations. If you’re a married individual with a house and cars paid off, this number will be much less. Regardless, it’s much better to have ample retirement savings than risking meeting the bare minimum, or worse, not meeting the minimum at all.
Another option people often resort to is an idea of working for 20 plus more years. Although this sounds fine considering people are living longer, this isn’t an ideal fallback plan. In fact, people over 50 typically have higher unemployment rates, as their jobs are being replaced for new, fresh faces. Once these individuals do get hired, they’ll most likely get paid much less.
It’s important to plan years in advance. As above stated, the earlier New Yorkers start planning towards retirement the better. While you may not be thinking about retirement for another 30 years, it’s important to consider putting money into a 401k or other retirement programs. Americans need to change their behaviors to ensure a stress-free retirement when the time comes. The “worry about it later” mentality won’t get us far in our elder years.