Retirement Money - What Will I Need?

There is some disagreement in the financial field over how much retirement money the average person needs. Many financial planners say you should be fine if you can bring in 80 percent of your pre-retirement wages once you retire. In fact, many financial calculators pre-program that figure or something close to it in a retirement income analysis. However, not every personal situation can be handled by a pre-programmed financial computer.

Consider a Financial Expert

There are plenty of financial experts available who will take your financial information, along with the knowledge of what you hope to do in the future, and come back with a figure of how much money you'll need monthly or yearly to retire comfortably. Once that figure is determined, planners can calculate whether your current savings plan will meet that goal or if you must boost contributions to a 401K or IRAs or perhaps establish an additional investment account for retirement. If you'd like to save the money to hire a financial expert, it's possible to calculate how much retirement money you'll need on your own. If you are concerned that a financial planner who is paid on a commission basis will try to get you into certain funds to earn the highest commission, it's possible find financial planners who charge an hourly fee. Some people prefer fee-based advice, believing they are getting a more objective assessment since the planner isn't going to earn a commission on any of your choices.

Get a Financial Calculator

Be careful in looking for one of the many available free financial calculators online. You want to find a calculator that allows you to input as many variables as possible - from a surviving spouse option with Social Security to the inclusion of a mortgage payment into retirement. Another important piece of advice from financial experts is to be very conservative as you calculate the amount of money needed in retirement. If you are uncertain about whether the mortgage will be paid off - or if you might acquire a new one when you retire - be sure to err on the side of including the mortgage costs. If you believe your 401K plan will continue to gain an average of 8 percent a year, as it has for many years, input 7 or 6 percent instead. Being conservative creates some cushion in the event of unanticipated financial struggles.