One of the most frequently asked questions that our Farm Bureau agents receive is: How much should I save for retirement? “As much as you can,” is the standard answer. It is a great question because the answer depends on who you are, what you’ve saved in the past, and at what age you started saving. This is your retirement, so let’s do some homework ahead of time to make sure you have enough retirement savings to achieve of the retirement of your dreams.
Our team of agents is always ready to help discuss your options. To help you get started, below we’re answering some questions that we hear every day.
1. How do I figure out how much I need for retirement?
The best way to start determining your savings needed is to use an online calculator like this one. It’ll help give you a ballpark estimate of how much you should accumulate over time. Be sure to refer back to this calculator frequently as your plans change. This is a great step to begin with because it only takes five minutes!
2. What are some of the best funding strategies for retirement?
Many financial planners recommend that you save 10 to 15 percent of your income for retirement, starting in your 20s. But that is just a general guideline. There are all types of strategies depending your preferences. Retirement accounts such as individual retirement accounts (IRAs) and 401(k)s are the most popular places to save for your retirement. The different types of plans have different features, but most of them allow you to defer taxes on the money you save and the returns you earn within the account. The best strategies usually are ones that a client/member can do on a regular basis. Start saving modestly so that you can continue for several years and keep momentum building.
3. When should I start saving?
Nothing is better than the time value of money, the sooner you can start the better off you will be. The sooner you begin, the more time your money has to grow.
4. How many funding strategies are too many funding strategies for retirement?
Work with your insurance agent to determine what works best for your appetite. If you like to take financial risks, there may be more options than if you’d like to remain conservative. There is no bad answer, but there are likely a few different ways you can save no matter how old you are.
5. There’s a lot of news articles about the increasing price of retirement and the lack of Social Security. How does this impact what I’m saving now?
It’s true. Depending your age, Social Security and pensions may not be enough, but don’t worry! At Farm Bureau Financial Services, your agent will sit down with the Regional Financial Consultant in your area and dive in deep with you to make sure you are getting the most traction out of your retirement strategies. You’ll create a budget together and work to chip away at wasteful habits. You won’t be alone in the process and hopefully won’t have you ask the question, “What if I don’t have enough?”
Want to explore more?
We want to help protect what matters most to you and your retirement. Explore some of our other articles below, and sign up for our E-newsletter to get retirement tips straight to your inbox.
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