by The Liz Luke Team
A post WWII surge of births - close to 77 million in the US - created the second largest generational cohort known as Baby Boomers. Falling slightly short in numbers only recently to the millennial aggregate, persons born between 1946 and 1964 qualify as boomers.
Boomers account for about one fifth of the current population and are heading into retirement by the masses - about 10,000 a day. Data suggests these 72 to 54 year olds, particularly those under 65, may be unprepared for calling it quits in their workplace.
Multiple studies from PEW Research Center and private retirement organizations report nearly a quarter of Baby Boomers have a zero savings balance. About half have a small nest egg, but many with less than $100,000. Those over 65 were most prepared with balances of $200,000 or more.
Many boomers nearing retirement will likely postpone this life event or face significant lifestyle changes that current Social Security payouts, less than $1,500 a month, can accommodate. If you’re facing these challenges, there’s time to re-route your retirement roadmap. Here are a few simple strategies for a more comfortable over-the-hill lifestyle.
Retirement Plans
An immediate change that will benefit you two-fold is to begin regular payments to your retirement savings. Many employers offer IRA or 401(k) retirement plans - they may even match a percentage of your contributions. Your contributions are deducted from pre-tax earnings, therefore reducing your taxable income. The IRS allows those over 50 to contribute up to $24,500 annually. Self-employed or feeling compelled to contribute more than the cap? A little help from a financial advisor can put you in a great position.
Basic Budgeting
Many of us fly by the seat of our pants when it comes to basic budgeting. Crunch time demands that you begin budgeting now to reduce monthly expenses. Non-essential spending goes first. Yes, that small gift for your grandchild will light up her life - for five minutes or so and then it’s into the toy bin with the rest of the plastic. Be diligent about spending money now so that you can live comfortably when your legs are little less capable.
Downsize
Minimalism is the latest lifestyle trend. Consider it. Downsizing may be necessary to achieve a savings balance that will accommodate your post-prime years of life. If you’re set on staying put, find ways to reduce your household expenses.
Create a Source of Passive Income
Another hot trend - renting your unused or underused household space to strangers. It’s less scary than it sounds and can yield a substantial source of income for retirement savings. Check out Airbnb or VRBO to find out how.
Real estate can be tricky. Your professional team of advisors should include an experienced and connected Realtor. Realtors are your liaison and advocate - putting you in the hands of trusted professional resources and finding creative solutions to common real estate dilemmas.
The LizLuke Team provides comprehensive transaction management - we handle matters that matter and the small stuff, too. Let us treat you to coffee to chat about your real estate journey. Planning now will pay off later. Learn more and contact us at lizluke.com.
