As with any large undertaking, preparing for retirement can be less daunting if broken down into smaller, achievable goals.
Allstate's fourth annual "Retirement Reality Check" survey shows that in 2004, overall, Americans believe they're taking the right steps to prepare for retirement, with 76 percent of respondents saying they are "somewhat" or "very" prepared financially. Yet, many still have some looming concerns about retirement expenses.
Despite these concerns, a mere eight percent of survey respondents have implemented all 10 recommended retirement preparation steps, which could be an indicator that someone is on track to meeting their retirement goals. By establishing retirement goals and the cost to achieve those goals early on, Americans can be on the path to a solid financial future.
Allstate's 10 recommended retirement-preparation steps are:
1. Educate yourself on the different savings options available and what might work for you. One investment may work for certain individuals or situations, but not for others.
2. Discuss with your spouse how the two of you want to spend retirement. Don't wait until retirement to learn you have conflicting goals.
3. Decide on an age to retire and how much you will need to save each month until then. Saving even a small amount can add up to a lot over time.
4. Determine how much you will spend each year in your retirement to maintain the lifestyle you want.
5. Set up a plan to automatically save a fixed amount each month. Remember, if you begin saving less than the designated monthly amount, you may have to add significantly to your savings later in life.
6. Decide which savings vehicles will help you best prepare for retirement; keeping in mind how many years remain before retirement, and the kind of lifestyle you'd like to have.
7. Monitor your savings and investments over time to determine whether you need to make adjustments to keep on track with your goal. .
8. Estimate how much you will receive from Social Security and/or from any employer-sponsored retirement plans.
9. Work with a financial professional to help ensure your insurance needs are adequate and keeping up with changes in your life.
10. Make sure your retirement plan has a financial cushion that allows for unexpected events and expenses.
For more information about retirement preparedness, visit www.allstate.com.
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