All good things must- and do inevitably- come to an end. Sooner or later, the wrinkles will start to show on our faces and the gray hairs will signify the demise of the days of endless bacchanalian buffets and bingeing sprees. When we get old, retirement will start knocking on our door. When that time comes, we don’t want to be caught unawares and find ourselves starving or relying on the good graces of others. Before it’s too late, we should start thinking about saving up for our retirement and golden years. But how much exactly should we save?
Experts normally recommend saving at least 15% of your take home pay each year. But there’s more to consider than figures. Nobody can accurately predict what will happen in the next five or ten years. Inflation, financial crises are all possibilities, and these will affect how much money will be sufficient to live without begging on the streets.
Right now, what you can start doing is assessing your spending habits and lifestyle in general. Your goal is to be able to maintain the same lifestyle once you finally retire. Take stock of what you have now, and note how you spend your money. Consider how much you would have already saved when you reach retirement age. Look at your spending pattern, and see how you can maybe modify it to fit your potential needs once you retire. Also think about your social security pensions and other retirement benefits your present employer may give you. If you have investments like bonds or stocks, add these to the equation as well.
To help you compute for your retirement needs, you can search online for a retirement calculator. These will help give you a clearer picture of things.
In order to live a happy life now, it helps to feel a sense of security about the future. If you want to lazily sit on a lounge chair while sipping a tall latte while you’re in your sixties, start saving up now.