Marion Syversen was in for this week’s Finance is Fun to talk about retirement and how are people getting ready for retirement, or already in retirement, how are they liking the decisions they made?
She explained how they are making decisions and what decisions people are making about the retirement transition.
How much- About 85% of what you are bringing in now is the amount many experts say is what you’d do well with in retirement. Fidelity Investments has estimated, living until perhaps age 92, we should try to save 6 times our ending annual salary. What do you expect to be earning near retirement? Aim to save 6 times that. But the sobering fact is that according to a survey by Employee benefit Research about 36% of folks have saved LESS than $10,000.
Social Security- According to a study by Nationwide Financial 38% of retirees regret having claimed their Social Security benefits early. An article in Investments News reports that retirees can claim Social Security benefits as early as 62, but their benefits are permanently reduced by 25% compared to waiting until full retirement age of 66 to begin payments. And those willing to wait even longer earn delayed retirement credits worth 8% per year for every years they postpone benefits up to age 70, increasing their benefits by an additional 32%. And that, my friends, is real money.
What age- The longer you wait the better for your wallet. Delaying retirement by even just a few years can increase your annual Social Security benefit, may allow your savings to grow for a few additional years. But healthcare costs are also a concern. And if you retire before age 65, and before you are eligible for Medicare, it could add to your healthcare costs.