How Much Money Do You Need for Retirement?

Your retirement shouldn’t be tarnished by financial worries. But how much money will you actually need to retire comfortably? Unfortunately, there’s no one-size-fits-all answer. It depends on several factors, including your desired lifestyle, location, and healthcare needs.

Key considerations:

• Current and future expenses: Estimate your essential expenses, like housing, food, and utilities in retirement. Factor in potential healthcare costs, leisure activities, and travel.
  
• Social Security: Estimate your expected Social Security benefit amount to understand the gap you need to fill with your retirement savings.
  
• Retirement savings: Review your retirement accounts like IRAs and 401(k)s. Consider potential future contributions and investment growth to gauge your overall retirement nest egg.
  

Rules of thumb can offer a starting point, but have their own pitfalls:

• The 4% Rule: This traditional rule suggests withdrawing 4% of your retirement savings in the first year, then adjusting for inflation each year thereafter. However, this approach is quite outdated and could be too conservative for many people.
  
• Multiply annual expenses by 25: This simplified method suggests you’ll need 25 times your annual expenses to cover retirement costs. However, it doesn’t account for potential inflation or rising healthcare costs.
  

An excellent option is to speak with a financial advisor who can help you create a personalized retirement plan that considers your risk tolerance, lifestyle, and financial goals to determine a more accurate estimate of your retirement needs. A comfortable retirement is achievable with careful planning and proper investing!

Hendricks Wealth & Estate Management will be speaking further on this topic during a FREE “Don’t Do Dumb” presentation at DC Cobb’s in East Dundee on July 17, 2024 at 5:30 p.m. CST. Someone in attendance will win 2 tickets to a Cubs game at Wrigley Field! To reserve your spot or learn about future “Don’t Do Dumb” financial sessions, visit www.jghfs.com/events. Questions? Call us at 847-428-3997.

Hendricks Wealth & Estate Management

650 Spring Hill Ring Rd., Ste. 2000

West Dundee, IL 60118

(847) 428-3997

www.jghfs.com