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Delayed retirement a Viable End-Game

A lot of personal financial consultants will explain the top way to save for retirement would be to commence in your youth and regularly save a share of your paycheck in a retirement savings plan like an Individual retirement account. And many folks certainly make this happen. But if you’re like many of us, you didn’t save as much as you might have, and today you’re in search of some last minute alternatives for a comfortable retirement.

On one hand, you can save additional amounts. But that isn’t always feasible for many. More immediate needs, including paying your mortgage and well being care bills, or helping out your young children and grandchildren, may be stretching your spending budget. About fifty eight percent of U.S. residents age 55 and older have saved less than $100,000 for retirement, according to the Employee Benefit Research Institute’s latest Retirement Confidence Survey. Only 19 percent have saved a quarter million dollars plus.

Meaning you may need to alter your goals for retirement. And one way to do that is to take into consideration not retiring – or retiring later. It may sound dismal, however it doesn’t mean abandoning lazy days with the grandchildren or on the links. You could simply postpone your retirement-or work part-time in retirement.

Keep in mind, it’s essential that you eliminate any wasted expenses:

Do you really need the $100 monthly health club or will the $19/month health and fitness center permit you to stay just as healthy?Should you continue to be giving your thirty eight year old son money?

Would you delight in vacations any less if you stay in the $150 per night inn and not the $250 per night hotel?Do you actually need that laser eye surgery treatment or abdominoplasty or hair replacement? Isn’t that eateries where you can get a good dinner for two for $35 just as gratifying as the place where you shell out $120? Does one use two thousand minutes on your cell phone plan or need to watch 240 channels on your cable TV?

You get the suggestion that there are likely hundreds if not thousands of dollars per month that are wasted and this waste helps make retirement seem to be a fantasy. Look over the charge card statements from the previous 3 months and see what amount of “retirement gold” you can find.

Delaying your retirement can substantially affect your retirement finances – not just mainly because each year is an additional year of saving cash, but for the reason that there’s also one less year that you have to live off your retirement fund. According to a March 2006 report from the Center for Retirement Research at Boston College, U.S. residents who hold off retirement by simply one year would increase their annual income in retirement by $1,317 to $2,402 annually, dependant upon no matter whether they tap 401ks. Those that hold off retirement by five-years would enjoy their annual retirement income augmented by $14,888.

To think about this in easier terms: the dollar from your retirement pot that you don’t spend today grows to $1.05 at 5 percent interest in a year. So by continuing to earn that extra year and not shelling out that $1, you have permanently elevated your standard of living from your nest egg by 5%.

Working half time in retirement also doesn’t have to be some thing you hate. You could take half time employment as a consultant in a company you know well, or possibly pursue a profession you often wanted – for example, working with kids in a library, or employing your time at the club house on the links (which could also lead to cost-free tee times!). Just how much can you save by putting off your retirement? Our retirement calculator can show you.

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