I'm 69 years old and have been working for the same company for 45 years. I have a pension of $250,000. My company was acquired and in 1997 my pension was frozen by the new company. The current company has faithfully moved its pensions, but not as part of my benefits.
I have 401(k) of $121,000 and $53,000 in company stock. My low 401(k) number is caused by many problems, including mismanagement and not looking at the future objectively. I plan to contribute to the 401(k) in addition to my stock purchase plan for several more years.
I received full social security ($3,507) and bought a house I rented 12 years ago. My wife, 61, does not work due to health issues. She also has a pension of about $53,000 and a $401(k) $47.000. She worked for the same two companies as me.
My wife has not worked in the past 15 years. Apart from the outstanding mortgages in our home, we have no significant debt. What do you think is the best way to continue repairing damage done in the past?
He hasn't retired yet
Related: “Why are you so scared of retirement?” I was 60 years old and lost $1.2 million in divorce. Can you rebuild your life?
Dear yet,
Can you take a little time to focus on what you did right? You did something very right.
You knew you had to build your pension and share purchase plan, so you kept working. You waited to assert your social security to get full profit. You are married and it seems happy. You bought a house and have made progress on mortgage repayments.
And don't overlook all the greatest results. You're now 69. congratulations! Despite the fact that it is a gift and involves complications, we should never take aging for granted. Considering you are still working, I think you are relatively healthy.
Given that you don't have a massive 401(k) you can count on, you are waiting to argue that your social security is a big plus. For example, if you were charging 62, you would only get 70% of the total amount.
You did a lot of it that was right.
Many people make mistakes with 401(k). They don't contribute enough, don't take advantage of catch-up donations of $7,500 a year after age 50, don't oversee your investment strategy, or don't distinguish between a Roth 401(k) and a traditional 401(k).
Or you may be in financial trouble elsewhere, such as credit cards or personal debt. Or, they must pay a 10% penalty before age 401(k) to 59½ years old, in addition to paying taxes on their withdrawal. They take away future growth.
You may not be where you want to be with your 401(k), but you do not hold a considerable personal debt and you hopefully have a home that will be repaid in time. Plus, compared to the average American with a 401(k) account, they haven't done it badly.
Average 401 (k) balance
According to Fidelity, the average 401(k) balance is around $242,200 (born 1946-1964) and $182,100 for Generation X (born 1965-1980), with an average 401(k) retirement balance for all age groups of $127,100.
“Sometimes, retirement savings can also serve as a source of emergency funding for non-retirement people facing financial difficulties,” the Federal Reserve report states. “Some non-retireers who may need a reserve fund to 'weather' difficulties may not have retirement savings. ”
Approximately 75% of non-retired adults had at least retirement savings, while 25% had no retirement savings, the report added. “Of those with retirement savings, these savings were most frequently made in defined contribution plans, such as 401(k) and 403(b),” he said.
Pay off your mortgage and get away from debt.
Citi Wealth C addressed this very question. What if you only have around $100,000 to retire? “The reality is that $100,000 in retirement savings are likely not enough to supplement Social Security for the rest of your life,” it said.
“It may be sufficient to serve as emergency funds for a variety of large household expenses that could appear, such as car repairs, home maintenance, property taxes, and more, but there is little room for error,” added the bank's wealth management arm.
“It's not likely that you'll be left every month for entertainment, travel, gifts, or many other simple people in life,” it said, citing a revival in food, electricity, heating, household items, and television streaming services such as NetflixNFLX and Hulu Dis.
The simple joys of life
I appreciate the overall message, but I do not necessarily agree that in my mind I have to abandon the simple joys of life, including cooking at home, enjoying books from the library, long walks, exercise, and enjoying quality time with family and friends.
Citi Wealth advises that retired households with $100,000 savings should protect their money in safe shelters such as high-yield savings accounts, financial markets, short-term bank CDs and US Treasury bills.
“These are low in risk, liquid and are gaining reasonable interest rates today,” the bank added. “The interest you earn can probably use interest between $4,000 and $5,000 a year to supplement your monthly expenses.” We don't recommend investing money in mutual funds or stocks.
You cannot undo the past.
What are you doing now? Keep enjoying life, paying off your mortgage, avoiding debt, putting your money aside for emergency funds, staying on your doctor's appointments, paying your own self-pay rather than saying “probably nothing.”
You can't undo the past, and you spend too much energy trying to repair past mistakes rather than splitting your hair. Without the line tied to the DeLorean and the Clocktower, we are no luck. However, by doing what you are doing, you can ultimately build to retire.
You are financially stable and in a safe position to retire in a modest and happy manner when the time comes. During the pandemic, I lived with two suitcases for four months and realized how little I actually needed in life. It was the biggest takeaway ever.
Thinking back to the future and not forgetting to enjoy the presents in everything you plan.
Related: “My retirement is going to be a disaster”: I'm 59 years old and have $45,000 for a 401(k). He's making $72,000. Am I destined?
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