Saving for Retirement

February 13, 2024

Financially planning for retirement is one of the most crucial steps you can take to secure a comfortable, fulfilling future. The ideal retirement savings amount depends on several factors—including where you want to live and the lifestyle you wish to lead. When you know how much to save and how to maximize your investments, you can prepare to move into your perfect retirement community. 

How Much Is Enough to Retire in the U.S.?

The appropriate retirement savings amount in the U.S. depends on variables such as your age and goals. Understanding how much you need to retire can help you gauge your status and adjust your financial planning accordingly.

Financial advisers typically recommend setting aside 15% of your monthly pre-tax income for retirement. You should place this money into a Roth IRA account through an investment broker or an employer-provided 401(k) account each month. Depending on your financial situation and retirement plans, you may want to save more. Investing your savings allows your money to grow with inflation, helping you keep up with the increased cost of living when you retire.

How Much Do I Need for Retirement?

Consider the following factors while planning how much you need to put away.

  • Spending habits: Factor in your typical monthly budget. Consider how much you spend on things like groceries, clothing and eating out. Unless you drastically change your habits, these figures probably will not change much.
  • Expected retirement age and life expectancy: Early retirement requires a bigger nest egg. For example, you will need to put significantly more money into your retirement account if you hope to retire at 55 than you would if you plan to retire at 65. Your predicted life expectancy is also essential. You may face financial challenges if you save enough to cover your expenses until age 82 but live to see your 90th birthday. See how long your relatives lived and save enough to last well past that age.
  • Retirement plans: Your retirement plans and goals significantly affect how much you should put away. For example, retiring in a beachfront house costs more than owning a small home or living with family members. The best option is to move into a comfortable, accommodating retirement community that fits your lifestyle. 
  • Hobbies: You must also consider what you plan to do with your free time in retirement. Activities such as traveling, vacationing, golfing and attending performing arts events can increase how much you need to save, so look at your current hobbies and what you might like to try once you have ample free time.
  • Health: Healthcare is always essential, but you should save extra if you have chronic conditions or complications requiring specialized care. Consider how much you pay for healthcare now and how much it may increase as you age.
  • Recurring expenses: Predict how many monthly bills and recurring expenses you will have in retirement. For example, you will most likely need to cover utilities, a phone plan and health insurance. However, you may not have a car payment if you pay your vehicle off before retirement and it is in good condition. 
  • Unexpected expenses: You should also save money for unpredictable expenses such as health complications, accidents, vehicle repairs or family emergencies.
  • Cost of living: Remember to factor inflation into your retirement planning. Monthly expenses tend to rise over time, so you must consider how your bills and spending might change after you retire.

Retirement Savings Strategies

Proactive financial decisions can help you strategically grow your money. You must create a robust financial plan to ensure you have enough money to meet your retirement goals and comfortably enjoy your golden years. Consider the following ways to optimize your retirement planning.

Diversify Your Investment Portfolio

Spreading your retirement savings across various investments helps your money grow while reducing risk. If one investment declines, you have others to fall back on. You can diversify your retirement portfolio by investing in the following mutual fund types.

  • Aggressive growth: An aggressive growth fund has the highest risk and reward potential. Aggressive growth funds bundle small-cap investments in startup companies with less than $2 billion values and significant growth potential. Investing in these funds allows you to put less money into stocks that could grow to earn you significantly higher amounts over time.
  • Growth: Growth funds bundle stocks from mid-cap companies valued between $2 billion and $10 billion.
  • Growth and income: Growth and income funds bundle stocks from established, predictable companies such as Walmart and Apple valued at $10 billion or higher. These high-value funds are less likely to have significantly high or low fluctuations than others.
  • International: International funds combine stocks from companies outside the U.S. Investing in these stocks is beneficial because they provide a safety net in case the domestic market dips or crashes.

Start Investing Early

Your money has more time to grow if you start investing in your 20s than if you open a retirement account in your 30s or 40s. Think about how long your retirement account has been open and how much you have contributed to it. You may need to save more each month to catch up if you waited longer to start investing.

Plan to Enjoy Retirement at Garden Spot Village

The place you call home and enjoy retirement is an essential part of planning, and saving for retirement lets you choose the perfect place to live. Garden Spot Village offers a vibrant, safe community where you can purposefully enjoy the next phase of your life to the fullest. 

Our micro-communities consist of passionate people who share interests like woodworking, beekeeping, gardening, metalworking and art. We take care of home maintenance and lawn work so you can focus on maintaining an active lifestyle, spending time with your family, serving your community, going on mission trips or exploring your passions. The Garden Spot Village campus features beautiful residential neighborhoods and fantastic amenities for an enriching retirement.

Your Garden Spot Village entrance fee depends on your preferred financial plan and the home you choose. Contact us to learn more about living at Garden Spot Village and start planning for a bright future.

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