Will you retire in 2024? 3 actions to take now
If you’re preparing to retire in 2024, it’s probably not a decision you’ll make on a whim. Rather, you’ve spent your entire career making connections, and as a result of careful planning, you’re finally moving toward that goal.
You will be so excited to begin a new and exciting chapter of your life sometime in 2024. But if you’re serious about retiring in the new year, you should do your best to take this important step in the coming year. A few weeks.
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1. Find out your estimated monthly Social Security benefit amount.
It’s no surprise how much you receive in Social Security each month. It wouldn’t be surprising if there was an easy way to find out how much you can expect to earn. All you really need to do is access your most recent earnings statement to see what your expected monthly benefit is.
If you are over 60, you should know that your statement will be mailed to you. So check your files for the most recent statements. If not, you can create an account on the Social Security Administration website and access that information there.
2. Find out how much your annual income will be based on the amount you save.
Maybe you have $400,000 saved for retirement. Or maybe you have more than $800,000.
No matter what your savings balance looks like, it’s time to figure out how much it actually translates into annual income. That way, you can combine that total with your Social Security to see if it’s enough.
Now you need to know what withdrawal rate to use to know how much annual income your savings will provide. Experts have suggested an interest rate of 4%, but this may be a bit aggressive. This is especially true if you expect to have a longer retirement.
It’s a good idea to sit down with a financial advisor and find out what rates are best for you. Then run those numbers to figure out what your early retirement income will be.
3. Make sure your investment is right for your situation
If you are building a nest egg, it is a good idea to invest heavily in stocks. However, as you approach retirement, it may be a good idea to switch to less risky, more volatile investments.
reason? Once your career is over, you can immediately start tapping your nest egg and liquidating your investments to cover expenses. So you’ll want to make sure that at least a significant portion of your portfolio is in instruments like bonds, which are much less volatile than stocks.
You should also make sure a significant portion of your nest egg is in plain old cash. A good idea is to have enough cash on hand to cover one to two years of expenses. However, if you have a very old house and expect a lot of repairs to be needed, it may be a good idea to add a little more.
Retirement is an exciting time to look forward to. If that’s your plan for 2024, use the next four weeks or so to work out these key moves so you can approach that milestone with more confidence.
