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Navigating Through Today’s Noise

Saving enough money to retire comfortably is one of the most common financial goals, but many Americans are not on track to achieve this goal.  Longer lifespans, increasing costs of health care, and the uncertain future of Social Security have all led to retirement becoming a much more complicated exercise. Furthermore, the bulk of the responsibility has shifted from employer based pensions and health care plans to individuals, many of which lack the experience to take on this endeavor.

Here are some important points to understand:

·         Procrastination is a retirement killer!

·         Social Security alone is not sufficient to fund retirement.

·         No-risk portfolios can be the riskiest of all.

·         Longer lifespans will mean retirement savings may need to be larger.

·         Medicare will not cover all health care expenses in retirement.

·         Average costs of retirement typically assume lower spending than pre-retirement, which may not always be the case.

·         More than half of Americans have less than $10,000 saved for retirement.

While this may all sound very dire, there are some clear and practical steps that all Americans can take to increase their chances. Perhaps the most important thing to do is to start saving as soon as possible. Procrastinating is one of the most common mistakes investors make. One should also come up with a concrete set of goals and expenses for retirement. In addition, a simple strategy is to simply live below one’s means and build for the future. Here is a quick and easy tool to see how one is tracking toward retirement.

Retirement Tracker

Wayne L. Locke, CFP®      
Matson Financial Advisors, Inc.