The idea of retirement can be unsettling from a financial standpoint. After all, you're going from collecting a paycheck to having to live off of savings and Social Security. And so, if you're feeling uncertain about your future finances, you're in good company.
Recent data from Northwestern Mutual found that 55% of Gen Xers feel they won't be ready for retirement by the time it arrives.
If you're in the same boat, it's important to address your concerns well ahead of retirement. And the good news is that if you're a Gen Xer, you still have time to do that. Here are some near-term steps to take.
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1. Map out a retirement budget
If you're still a solid decade away from retirement or more, you may not have such a keen sense of what your spending will look like once your career ends. But you can at least try to come up with some type of budget based on your goals and desired lifestyle. That will give you some numbers to work with in the course of your planning.
Think about things like where you want to live and what type of home you want. A condo, for example, is apt to cost less than a larger, stand-alone house. Also, think about how you wish to spend your days. Local travel is apt to be less expensive than international trips.
2. Ramp up your retirement savings
It's not easy to carve out money for retirement plan contributions — not when you have to cover mortgage payments and college tuition bills and higher grocery costs thanks to inflation. But if you're able to increase your savings rate modestly, and you then continue to bank your raises for retirement for the remainder of your career, you might grow your IRA or 401(k) balance nicely.
Also, take a look at how your savings are invested. If you're loaded up with conservative assets, make changes. It's OK to shift away from stocks when you're within a few years of retirement. But if that milestone is a decade away or longer, try to stick with stocks to grow your nest egg at a solid pace.
3. Figure out what Social Security benefit you're in line for — and how to boost it
The money you collect from Social Security might help you cover your expenses to a large degree in retirement. So it's important to figure out what monthly benefit you're in line for. And you can do that by creating an account on the Social Security Administration's website and accessing your latest earnings statement. It should contain an estimate of your future benefit.
Of course, there are steps you can and should take to boost that benefit if you're not feeling confident about retirement. One is to plan on working until age 70 so you can delay your Social Security filing until then. Another is to grow your job skills so you can snag raises at work. The more money you earn, the higher a monthly benefit you might end up with.
It's important to feel good about the idea of retirement. If you don't, take these steps to improve your outlook and increase your chances of being able to live comfortably once your career wraps up.
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The post 55% of Gen Xers Say They Won’t Be Ready for Retirement When It Arrives. Do These Things if You Feel the Same appeared first on Retirely.