I’m in Fort Lauderdale, Florida, at a retirement education seminar and I’m going to be speaking in a few minutes about retirement.
And it strikes me that, for something that’s so important, our retirement, very few of us actually plan and do the right steps. And I hope that’s not the case for you.
But if you think about your retirement, can you answer the two most basic questions: How much is my retirement going to cost? And how am I going to pay for it? And you’ll be shocked to find out just how significant it is to retire these days. And that’s why many people are working longer and longer.
So, I hope that you are planning for your retirement because if you are, you’re well ahead of the game. Most individuals when you say, “How much will my retirement cost?”, they don’t even know where to start. I’m going to give you a little quick way to find out whether you’re prepared for retirement.
If you know what you need for income, when you retire, on an annual basis. Let’s say you need to make $100,000 a year to retire and live the life you want to live or live the life that you’re currently living. Well then you just merely take that number times 25, and that gives you an initial starting point on how much your retirement’s going to cost.
Now, when you think about that, if I need $100,000 a year to retire, times 25, that’s 2.5 million dollars. That’s a lot of money to save. Hopefully you’re well on your path to save that money. But if you haven’t, there are ways that you can get started, there are things that you can do. I can’t answer them all right here. But I definitely can tell you that you should put money in your 401k, you should max that out. You should set aside money because money makes money. And that’s an old Ben Franklin statement.