A professional San Mateo financial advisor may offer his or her clients very helpful retirement planning tips. This advice can be particularly useful since Social Security benefits and pension plans are falling way short of being able to provide adequate income for a person during his or her retirement.
According to the United States Department of Labor, the average American will spend about 20 years in retirement. Officials also estimate that less than half of adults actually calculate how much they would need to support themselves during these two decades. Unfortunately, many are not preparing for their retirement years properly. In 2010, only about 30 percent of workers who had access to employer contribution plans, such as a 401k, chose not to participate.
Knowledgeable advisers have suggested some basic methods for preparing for the years following employment. The most critical step is to open a savings account. Workers who have already opened these accounts should continue saving, increase the savings deposits when possible, and avoid taking funds from the account.
To provide some meaningful insights into how a savings account can grow, financial advisers have broken down a scenario. If an individual deposits 5,000 dollars into a savings account each year, and earns 7 percent interest, she or he will have 28,754 dollars in the account after five years. After a period of 10 years, the account will grow to 125,645 dollars, and after 25 years, it will reach 316,245 dollars. If the deposits continue each year for 35 years, the account holder will have a balance of 691,184 dollars.
It is important to calculate the anticipated amount of Social Security benefits. This type of funding usually equates to 40% of a worker's income during the pre-retirement years. A helpful estimation page is available on the website of the U. S. Social Security office.
The San Mateo financial advisor often suggests that people accumulate 70 to 90 percent of their annual incomes for each year of retirement. This proportion has been identified as basic levels needed for a person to maintain her or his standard of living from before retirement.
According to the United States Department of Labor, the average American will spend about 20 years in retirement. Officials also estimate that less than half of adults actually calculate how much they would need to support themselves during these two decades. Unfortunately, many are not preparing for their retirement years properly. In 2010, only about 30 percent of workers who had access to employer contribution plans, such as a 401k, chose not to participate.
Knowledgeable advisers have suggested some basic methods for preparing for the years following employment. The most critical step is to open a savings account. Workers who have already opened these accounts should continue saving, increase the savings deposits when possible, and avoid taking funds from the account.
To provide some meaningful insights into how a savings account can grow, financial advisers have broken down a scenario. If an individual deposits 5,000 dollars into a savings account each year, and earns 7 percent interest, she or he will have 28,754 dollars in the account after five years. After a period of 10 years, the account will grow to 125,645 dollars, and after 25 years, it will reach 316,245 dollars. If the deposits continue each year for 35 years, the account holder will have a balance of 691,184 dollars.
It is important to calculate the anticipated amount of Social Security benefits. This type of funding usually equates to 40% of a worker's income during the pre-retirement years. A helpful estimation page is available on the website of the U. S. Social Security office.
The San Mateo financial advisor often suggests that people accumulate 70 to 90 percent of their annual incomes for each year of retirement. This proportion has been identified as basic levels needed for a person to maintain her or his standard of living from before retirement.
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