In case you haven’t noticed, retirement is changing. When was the last time you had a job with a pension or even an employer-matched contribution to your 401(k)? And now we’re hearing that Social Security benefits may not pay out as much as expected if at all by the year 2034. So, if you were counting on these things to fund your retirement, it’s time for a new strategy.
A new study from the Aegon Center for Longevity and Retirement, “The New Social Contract: a blueprint for retirement in the 21st century,” outlines the top global concerns people have about retirement. These include worries about reductions in government benefits, increased life expectancies, volatility in financial markets, and changes in the labor market.
The times they are a-changing. These concerns are firmly rooted in a world that’s moving on from traditional retirement plans designed for traditional retirements. Now people are living longer, meaning more years with more possibilities. The jobs-for-life your parents’ generation experienced have given way to a workforce much more inclined to participate in job hopping and the gig economy of independent contractors that have little to no retirement programs associated with them.
This evolution in work life and our economy is pointing more to the likelihood of self-funding your own retirement. If that has you feeling rather insecure about your future financial security, don’t worry. We’ve got some tips to get you there. Ideas you can even manage between your temporary day job and weekend Uber driving.
Prioritize saving and investing for retirement: Whether it’s an employer plan or your own, put away whatever you can, consistently.
Beef up your financial literacy: Take classes, read books and articles (like this one!). If you still can’t wrap your head around it, consult a financial professional for guidance.
Help protect against market volatility: You don’t want to watch your hard-earned retirement savings nosedive in a choppy stock market. Diversify investments so you stay relatively stable.
Prepare for changes in the job market: Be a lifelong learner of new skills to remain flexible, and prepare to be an independent contractor if you lose or leave full-time employment.
Embrace healthy lifestyle habits: Health issues with costly medical bills may cause you to pull from your retirement savings. Fend them off by taking care of yourself with healthy eating habits and regular exercise.
What’s your savings plan for the new age of retirement? Share your ideas and tips below.
Neither Transamerica nor its agents or representatives may provide tax, investment or legal advice. Anyone to whom this material is promoted, marketed, or recommended should consult with and rely on their own independent tax and legal advisors and financial professional regarding their particular situation and the concepts presented herein.
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