What if 1 Million Dollars Isn't Enough to Retire? SHP Financial

If you are headed toward retirement soon, or you have just retired, you may find yourself wondering, “Is my nest egg enough?” It’s a common question and one that causes a lot of people a lot of reasonable anxiety. Because retirement finances are much more about prediction than they are about facts and assurances, it can be hard to feel confident that you will have enough to carry you through your entire retirement. As you know, medical expenses, long-term care, housing repairs, and other unpredictable costs are just a part of life, so how can you prepare for those kinds of things during your retirement?

One thing that may help is getting a sense of what other people have saved on average. Here are the average savings of Americans by age group:

  1. Less than 25 years old: $6,264
  2. 25-34 years old: $37,211
  3. 35-44 years old: $97,020
  4. 45-54 years old: $179,200
  5. 55-64 years old: $256,244
  6. 65+ years old: $279,997[1]

This is just the average though. Your situation may be very different and have very different requirements than another person’s situation. Everyone’s retirement goals, financial situation, and timelines are vastly different, which may require you to cover different costs, opt for different income and investment products, and approach funding your retirement differently than the “average.”

Even millionaires next door have been worrying lately about their retirement because of a year of bad stock returns and unprecedented inflation.[2]  Let’s consider a person with 1 million dollars in their retirement accounts. According to traditional wisdom, you want to withdraw 4% of your 1 million dollars in your first year of retirement.[3] This comes to $40,000 a year, which is a much lower figure than most retirees are probably expecting to see. Withdrawing 4% of the average retirement savings of $279,997 is only about $11,000 a year.

It is important to think about your retirement budget and how much you plan on spending in your retirement. You may have to adjust some of your lifestyle choices to reflect this change in income.

If you are feeling unsure about if you have saved enough for your retirement, Click HERE to reach out to us at SHP Financial and we can talk through suggestions and options for your specific situation.

 


The content presented is for informational purposes only and is not intended as offering financial, tax, or legal advice, and should not be considered a solicitation for the purchase or sale of any security. Some of the informational content presented was prepared and provided by tMedia, LLC, while other content presented may be from outside sources believed to be providing accurate information. Regardless of source no representations or warranties as to the completeness or accuracy of any information presented is implied. tMedia, LLC is not affiliated with the Advisor, Advisor’s RIA, Broker-Dealer, or any state or SEC registered investment advisory firm. Before making any decisions you should consult a tax or legal professional to discuss your personal situation.Investment Advisory Services are offered through SHP Wealth Management LLC., an SEC registered investment advisor. Insurance sales are offered through SHP Financial, LLC. These are separate entities, Matthew Chapman Peck, CFP®, CIMA®, Derek Louis Gregoire, and Keith Winslow Ellis Jr. are independent licensed insurance agents, and Owners/Partners of an insurance agency, SHP Financial, LLC.. In addition, other supervised persons of SHP Wealth Management, LLC. are independent licensed insurance agents of SHP Financial, LLC. No statements made shall constitute tax, legal or accounting advice. You should consult your own legal or tax professional before investing. Both SHP Wealth Management, LLC. and SHP Financial, LLC. will offer clients advice and/or products from each entity. No client is under any obligation to purchase any insurance product.
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