If you’re one of the 56% of Americans who currently have less than ten thousand dollars saved for retirement, the future is obviously anything but secure. Unfortunately, there is little comfort to be found in the knowledge that you are not alone in your failure to provide for your own retirement. The problem is that a lack of retirement planning has implications that go beyond your ability to enjoy your twilight years in comfort. It can impact important other areas of your planning as well, and can even make it more difficult for you to leave behind a worthwhile legacy for your loved ones. It’s vital to understand how retirement planning can affect your estate plan if you want to ensure that you can take care of your family’s needs when you’re gone.
Why Retirement Planning Matters
There was a time in the United States when more people had access to pensions and other employer-based retirement plans. When manufacturing formed the backbone of the middle class, many millions of Americans had access to jobs that often sustained them throughout their entire adult lives – and pensions that secured a retirement that was worthy of the hard work they had put forth during their working years. As those manufacturing jobs disappeared, however, so too did those generous pensions. Today, a clear majority of American workers have little or no retirement savings to rely on when they eventually reach their senior years.
That will have incredibly negative consequences for those workers’ ability to maintain their current quality of life. Millions of today’s workers will become senior citizens with nothing more than Social Security to meet their needs. And, as anyone who has ever looked that program can tell you, Social Security benefits simply won’t be enough to pay a middle-class retiree’s bills. Anyone who wants to maintain that lifestyle in retirement needs to plan now to ensure that he has income beyond what the government will provide.
How it Impacts Estate Planning
Not only will a lack of retirement planning severely affect your ability to sustain your current quality of life on a long-term basis, but it will also impact your ability to engage in sound estate planning. If you intend to plan for things like college for the kids or want to leave something behind for your loved ones when you die, you obviously need to have money to fulfill those dreams. Without sound retirement planning, you won’t even have enough to take care of yourself in your senior years. And that means that you can pretty much forget about taking care of anyone else.
This is true even if you have already made out a will or drawn up other estate plan documents. If your senior years are destined to be nothing but a daily fight for financial survival, you’ll never have the security you need to make your estate plan goals a reality. That may be difficult to read, but that doesn’t make it any less true. Sometimes, reality is a bitter pill to swallow.
To achieve your long-term estate planning goals and leave behind a legacy that you can be proud to share, you need to have a better plan in place for your own financial well-being at every stage of life. That means sound financial planning today that will help you achieve the retirement plan you’ll need for tomorrow. The good news is that there are some steps that you can take to ensure that you make progress in your efforts to better prepare for your eventual life as a retiree.
Take Charge of Your Future
With competent financial planning to help you take charge of your own finances, you should be able to begin to save and invest for retirement. The following basic tips can help:
- Learn to save. Believe it or not, most Americans today live from paycheck to paycheck, with a substantial portion of the population maintaining less than $1,000 in family savings. They’re literally one missed paycheck away from crisis. Even if all you can do is save 5% of each check, it’s a start.
- Scale back on spending. If you review your actual spending habits, chances are that you’re wasting hundreds of dollars a month on purchases that you don’t need. That money could be better used as part of your retirement plan.
- Take advantage of structured plans. If your employer offers a 401(k), contribute to it – and contribute as much as you can. These plans are a great way to build substantial wealth during your working years. If the company doesn’t offer such a plan, you can achieve similar results by opening an individual retirement account, or IRA.
- Get investment advice to maximize your return. Compound interest is an important component of achieving future financial success, but so too are sound investment decisions.
- Make your retirement plan a priority. Even if you’re getting a late start on the process, that doesn’t mean that you cannot make important progress toward your retirement goals. You may have to save a little more to catch up, but don’t even consider giving up. Your future comfort and well-being depends on your commitment to saving and investing today!
- Get help from estate and retirement planning experts who have the experience you need to achieve your long-term objectives. Don’t be content to just rely on trusted friends or family members; instead, rely on professionals who can help you to navigate these complex issues.
At the Law Offices of Mary A. Miller, P.C., our retirement planning team can work with you to help you get your retirement plan back on track and in sync with your broader estate planning goals. We know how important it is for all our clients to maintain their quality of life during their senior years and protect wealth so that they can achieve their legacy objectives. If you’d like to learn more about how our experienced estate planning team can help you to make the most of your retirement years through sound planning today, give us a call at (914) 939-6565 today or take a moment to visit us at our website.