Social Security: If retirement is near, start planning now
Autumn in America marks our transition from summer to winter. Leaves change colors, temperatures drop, crops are harvested and nights get longer. For many baby boomers, this autumn season also signals a personal transition. In a few short months, they can move from the workforce into retirement.
Those who may be nearing this milestone need to be sure that they are prepared to make this important life-choice. The unfortunate truth is that, according to a study by Boston College, about one-third of all people now within 10 years of retirement eligibility will not be able to meet their retirement financial goals unless they save more or work longer. To find out how prepared you are, visit the Social Security Administration's financial planning page at www.socialsecurity.gov/planners.
The calculators featured on this site test different retirement ages and calculate future potential earnings amounts. A link to a worksheet will also help you decide how much you need to save and invest for a comfortable retirement.
In addition, www.mymoney.gov is a financial website supported by a variety of federal agencies. This site provides information on how to save, invest and manage your money during all stages of life.
We all know that working longer may not always be an option, due to health issues or other concerns, so it is wise to begin saving for retirement as soon as possible. The level of your savings is a personal choice, but most financial planners recommend 70 to 80 percent of your pre-retirement income to live comfortably. Social Security will only replace about 40 percent of what average wage earners make before they retire.
This leaves a 30 to 40 percent gap in retirement coverage. Private pensions, IRAs and savings or other investments will need to satisfy the difference. Each year, the Social Security Administration mails every worker age 25 and older a Social Security Statement. It is important to read this document carefully to see how much you and your family can expect to receive from Social Security when you retire, if you become disabled or die. If you find a discrepancy between your records and our records, contact us today so that your future benefits will not be delayed.
With a little bit of planning and effort, your transition from work to retirement can be as pleasant as the fall foliage.
Gene Moreno is the manager of the Social Security office in Prescott.