On average, the typical retirement age in the United States is 63 nowadays. So, how could you pull off retirement by age 50? Follow this guide!
Can I Retire At 50?
For many people, retiring by age 50 is a goal. Through hard work, careful planning and budgeting, yes, early retirement is within you reach! You will certainly have to sacrifice throughout your younger years, likely living below your means in your 20s, 30s and 40s.
Use these six tips to create the path towards a happy and healthy retirement:
1. Decide On Early Retirement
The first step of retiring early is deciding on early retirement as soon as possible! If retiring at 50 is your goal, it is more attainable, of course, if you decide on this number by age 30 rather than 40. This may seem like common sense, but deciding on early retirement can be difficult while raising a family and climbing the corporate ladder. Maximize your savings by picking up a part-time job or asking for bonus opportunities at work.
2. Figure Out What Type Of Retirement You Want
Needless to say, everyone envisions a different type of retirement. That means there is no such set answer for how much money an individual will need to retire. The suggestion here is to have anywhere between 60-100% of your pre-retirement income available to you during each year of your retirement. The type of retirement you are striving for will decide if you need closer to 60 or 100% of this income. For instance, if you plan on traveling the world, you may need closer to all of your income.
A comfortable yet modest retirement lifestyle may only require 60% of your income. To start figuring out how much money you’ll need, estimate your salary by the age of 50. Decide on your retirement lifestyle, then multiply the salary figure by either 0.6 or 1.0. This should give you a ball-park figure of how much you’ll need every year of your retirement.
3. Set A Retirement Income Strategy
Even though you have stopped working, it doesn’t mean your money should retire too! As you approach early retirement age, come up with a plan to keep your money working and stretch it throughout your retirement. Common strategies include opening traditional/Roth IRAs or certificates of deposit (CDs). Picking up a low-stress part-time position could help during retirement, as well.
4. Create An Investment Plan
Retiring at the age of 50 means you’ll have less working years to accumulate wealth. There are many ways to make up for that, though. For instance, you could invest all throughout your working years into your retirement. If you are working on a smaller salary, try to chase higher returns with an aggressive portfolio. This portfolio will be made up mostly of stocks, which can be volatile, unfortunately. A successful early retirement is certainly dependent on good planning, budgeting and smart investing.
5. Adjust Your Lifestyle
Fortunately, this does not mean you have to drastically alter your current lifestyle. Instead, start saving money that is not part of the normal methods. Re-evaluate your current spending habits, savings and investment options. Rid yourself of any unnecessary expenses, if possible. Typically, this includes things like eating out or going on long and expensive vacations.
6. Max Out Your Retirement Accounts
IRAs and 401Ks have annual limits on contributions. Simply by maxing out one or all of your retirement accounts, you will have more tax-advantaged money for your retirement. Financial experts suggest living far below your means, especially during your 20s, as you start out in the workforce. The sooner you can max out all of your retirement accounts, the better!
Vista Winds Is An Upscale Retirement Community Located In Peoria, Arizona
If you are doing research about retirement communities in Peoria, Arizona, Vista Winds Retirement Home should definitely be on your list. Vista Winds offers retirement living at its finest. We have a rich calendar of activities, meals prepared by a Chef and caregivers on staff 24 hours a day for your health and safety. We offer award winning independent living, assisted living and memory care services. Come tour our community to see how we are a step above the rest and how easy it is to Make Yourself at Home! Vista Winds is surrounded by amazing views and our resort style property will be sure to impress!
More Articles About Retirement
- How To Find A Retirement Community In Peoria, Arizona
- Easy Crafts For Seniors With Dementia
- Top 8 Low Stress Jobs After Retirement
- Can I Retire At 60 With 500K
- 55 Funny And Inspirational Quotes About Aging
- Retiring In Arizona Pros And Cons
- Cost Of Independent Living 2021
- Cost Of Assisted Living In Arizona
- Independent Living Vs Assisted Living