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5 Signs You’ll Never Run Out Of Money In Retirement

5 Signs You’ll Never Run Out of Money in Retirement

The fear of running out of money after you retire is common among both workers and retirees. How do you know if you’ll be able to do all the things you want to do and still have plenty left over for your kids to inherit? If most or all of the following statements apply to you, then you’re on track to have ample funds when you retire.

1. You know your “retirement number”

When you’re decades from retirement, it’s hard to figure out just how much money you’ll need to get by as a retiree. There’s a lot that can happen between now and then, which is why experts have come up with a number of ways to calculate how much you’ll need. Saving 10 times your current income, or saving enough so that you can replace 80% of your current annual income, or simply saving 15% of your income each year are all common methods of finding your retirement savings target. Whether you’re using one of these “close enough” approaches or you’ve spent some quality time with a retirement calculator to get a more customized result, you’ve figured out — realistically — how much you need to save by retirement age.

Senior couple dancing on beach
Image source: Getty images.

2. You have a plan and you’re sticking to it

Once you have your retirement number, you need to act on that information. The next step is to figure out how to get your savings target out of your budget and into a retirement account. That means you need a saving plan. Usually, the best approach is to set up an automatic transfer so the money will flow into your retirement account without ever winding up in your hands. If you have a 401(k), you can ask your company’s plan administrator to set up a direct deposit to the account with every paycheck. If you have an IRA, then you can set up a regular transfer with your bank.

Of course, if you’ve elected a more manual approach and it’s working for you, then by all means stick with it. The important thing is that the money you need to save is landing in your retirement savings account on schedule.

3. You’re using the money wisely

That money you’re saving so religiously shouldn’t just lie around in your account and languish. That money should work as hard as you do, making much more money for your future use. And the only way to make that happen is by investing your retirement savings, with an emphasis on stocks. The long-term return of the stock market blows nearly every other type of…

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