How to Save Money for Retirement


Saving money for retirement can be easy or difficultdepending on your current salary. If you are like 75percent of the American population, earning just enoughmoney in your current job to meet your monthly bills, thenit's time to do some serious thinking on how you are goingto live when you retire.

Social Security isn't going to meet all your monthlypayments. That is, if Social Security, or some revised formof it, still exists when your day of retirement arrives.

Here are some tips on how to save today for your future. Nomatter how little, or how much, you earn today.

Estimate how much you must save to give you the income youknow is necessary for you to retire in comfort.

Experts suggest that you will need an income equaling about75 percent of your current take home pay. Be sure toestimate a rise in inflation which has historically beenabout 5.3 percent per year.

Figure out how much of your current salary will need have tosave each year to achieve your retirement goal by countingbackward from the year you plan to retire to see how manyyears you have before retirement. Include the possibilityof being on a fixed income for as long as 20 or 30 years.Depending on how many years you have until retirement a U.S.Treasury bond that guarantees six percent interest might beconsidered, while stocks might have the potential for amuch higher return, but has a much higher risk of loss.

A financial planner, stockbroker, or an accountant, canoffer guidance, expertise and access to knowledge aboutalmost any type of investment or retirement planningconcerns.

Spread your money out over a variety of investments. Somewill prosper while others may fail.

Set up an automatic draft from your bank account from yourpaycheck so that a portion of your income goes directly intoyour retirement funds.Pay off major debts, such as home mortgages, college loansand other significant cash-flow drains, as quickly as youcan.

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Author: Marilyn Pokorney
Freelance writer of science, nature, animals and theenvironment.
Also loves crafts, gardening, and reading.
Website: http://www.apluswriting.net