If you’re worried about securing your retirement, the USAA offers some questions you should answer in order to make the most out of your retirement.
When do you want to retire?
The sooner you plan to stop working can means the less time you have to save, the less time your portfolio has to grow, and the longer you’ll be in retirement. Set a date you’d like to retire and be prepared to postpone that date, because it may take longer for you to acquire sufficient funds.
How long will your retirement last?
Your life expectancy is unclear, and half of all people live beyond their life expectancy so setting that as the target for your retirement is a major mistake. For married couples, chances are that one person will live to be 95, so the USAA suggests planning a retirement that last until at least that age.
How much income will you need?
A rule of thumb is that you’ll need about 80 percent of your pre-retirement income, but it’s best to make your own estimate. Benefits from military pay or Social Security should also be taken into account, but only conservatively given the sustainability of such benefits.
How big is your retirement portfolio?
The more you’ve saved the better. Having a bigger portfolio means a brighter retirement, so make sure you can be confident in the amount of money you’ve accumulated in your portfolio.
How much are you saving?
Ongoing retirement savings are an important part of your retirement future. Factor in the contribution from your employer, but only if you’re planning on staying there long enough to reap the benefits.
Finally, add it all up. Crunch the numbers and use online retirement calculators that can help you discover if your plans are accurate.