Retirement | Mike McRitchie | Resume and LinkedIn Profile Writer

In Your 20s

Although you might want to work on eliminating debt and spending money on fun experiences in your 20s, this decade is also a great time to start planning for retirement. Here are a few early steps to take:

Open a retirement account: Evaluate the differences between accounts such as 401(k)s, Traditional IRAs, Roth IRAs, and SEP IRAs, then choose one that’s right for you.

Automate your savings: After opening your account, set up recurring automatic payments so you can invest part of your paycheck every month.

Create an emergency fund: In addition to a retirement account, it’s a good idea to set up a savings account with emergency funds for rent, food, and other necessities.

In Your 30s

After you’ve set the retirement planning groundwork in your 20s, here are some steps you should take in the next phase of your life:

Add to your emergency fund: To account for big life changes, add more emergency funds to cover three to six months of expenses.

Boost retirement savings: In addition to automated withdrawals from your paycheck, you can add to your retirement savings by cutting unnecessary spending, eliminating debt, requesting raises, or pursuing side jobs.

In Your 40s

Once you hit your 40s, it’s generally best to have three times your annual income in your retirement savings. To make sure you reach that benchmark, use these tips:

Rethink goals: After examining the progress you’ve made thus far, adjust your retirement goals and figure out which areas need improvement.

Invest more: If you take more investment risks at an earlier age, you’ll have more time to accumulate rewards and recover from unsuccessful investments.

In Your 50s

In addition to having six times your annual income in your retirement savings, keep these steps in mind once you’re in your 50s:

Use catch-up contributions: Depending on your retirement account, you might be able to add catch-up contributions if you’ve fallen short of your retirement savings goals.

Plan for healthcare costs: Based on your current health, you may be able to anticipate some of the healthcare and assisted living costs that could come down the road.

In Your 60s

At a minimum, you should have eight times your annual salary in your retirement savings when you’re 60. Here are some other retirement planning tips for this decade:

Set a retirement budget: Figure out how much your monthly expenses will cost and create a retirement budget accordingly.

Wait on Social Security benefits: Although you’re eligible for retirement benefits at 62, waiting to receive them until you’re 67 can increase your Social Security benefits.

Purchase an annuity: To prevent you from outliving your savings and fund your retirement, you may want to purchase an annuity.

By taking these steps while in the workforce, you can set yourself up for a fulfilling retirement. To ensure that you meet your goals, use this printable monthly goal tracker to monitor your progress.

Photo credit: Nick Kenrick.. on Foter.com / CC BY-NC-SA

[Article republished from “Mondays with Mike – 2/12/18” email newsletter ==> Subscribe to get weekly newsletter in your inbox plus FREE REPORT]

I’m a planner.

I almost always think things through before taking a big leap.

But even for me, I don’t always truly understand what I’m getting myself into before I jump.

Now maybe you’re like me. Or maybe not. Maybe you just jump and figure it out later. That’s fine too.

Today I want to share my experience with several of these jumps. Either from my personal experience or from conversations with people who’ve taken the jump. To give you a sense of what the other side is like. And to give you some ideas on how to make a better transition.

Parkour

I took up Parkour (the art of moving around obstacles quickly and easily) as a way to get some exercise outdoors (I hate working out in a gym). I got inspired by watching American Ninja Warrior on TV (an obstacle course competition) and thought this might be something I could do to get in shape with and also do with the kids when I took them to the park without looking ridiculous (because I’m just playing with my kids, right?)

So you jump from place to place, climb walls, vault over things, jump off things with a soft landing or roll.

I found it entertaining. And as I progressed I tried different things.

And if you’ve ever watched this stuff on TV or YouTube, you’ve also seen the fails.

One time I was vaulting over the side of a slide but planted my hand wrong and biffed it. Happened to have my kids and Dad there. They all got a chuckle out of it.

In this case I’d done the vault many times before but not with this kind of hand placement. And I failed.

I failed many times and luckily none resulted in injuries other than skinned elbows.

But by taking the risks and learning as I went I found the skills helpful.

One case was I was going on a run and one of the expansion cracks as I went from the sidewalk to the street was raised extra high and caught my foot. I lost my footing and tumbled head over heels. But because I’d practiced my “Parkour Roll” so many times, I automatically tucked into my roll, rolled smoothly, and popped back up and kept running…not even a scratch 🙂

Now you might be asking, “What does that have to do with me? I couldn’t care less about learning Parkour.”

So lets take the next one.

The Other Side of 9 to 5

There are three version of this – two I’ve already experienced and one I’m preparing for.

My first experience with this was back in the late 80’s. I got a job selling residential real estate.

Now this was before I had many 9 to 5 jobs.

I loved that I set my own schedule and no one told me what I had to do. My manager gave me guidance. Such as about how to farm a neighborhood (getting the owner info from a title company and then walking the neighborhood and talking to homeowners).

But early on I realized that doing this during the daytime, even back then when the working mom thing wasn’t as common, there were still very few people home at that time that I could talk to. They were generally gone during normal business hours. Either at work or out running kids around or shopping or just not answering the door.

So I found that I was working more evenings and weekends.

The fun part was this allowed me to go golfing during the day during the week. When the courses were wide open. One time I golfed with other people in a similar situation as me. They were pro bowlers coming through the area. They bowled when people watched (evenings and weekends). So our schedules lined up.

The downside of all this was my friends weren’t available when I was home. So even though I had time to do things when others weren’t and that allowed me to avoid the crowds, I couldn’t do it with people I wanted to share my time with. That sucked. It was lonely for me. Didn’t like it.

So that got me thinking, especially as I crossed the 50 year old mark, what retirement will be like. And how I might plan it better.

Retirement Planning

Retirement isn’t just about having the money to retire. That is a very important piece. But what many neglect is the social part of retirement.

When you go from spending 8-12 hours (including prep and commute) at a job. And then you now have that time available to you now (40-60 extra hours a week to do something). It can be a shock to your system.

Are your friends retiring with you? Or are you going to have to make new friends?

Do you have a hobby that can take up a big part of each day?

Can you volunteer?

Can you consult?

Will you spouse or partner be okay with having you around the house that much more? Or will you drive each other crazy?

Here’s the thing.

Most people get really excited during the first few years of retirement. They take up golf. They travel. They do the things on their bucket list.

But at a certain point you’ve run through the list of things that you were really excited about doing and now you’re down to the ho hum ideas.

So you scale that back.

And at that point you really need to figure out what it is you can do and want to do that will fill up your days.

Because without that figured out, you’ll likely do nothing and eventually die. It used to be that people died within a couple years of retirement. They just didn’t know how to cope. Losing all their friends and their purpose. Their reason for living.

That is why Social Security was sustainable. The bad news is it is no longer as sustainable because people are living longer after retirement. But that is probably good news for all of us…because we’re figuring out this retirement thing.

Which leads me to a solution to prepare for the other side in a safer, more fun way.

The Side Hustle

As you know this is my side hustle.

Writing this weekly email newsletter, blogging, writing resumes and LinkedIn profiles for people, and helping small businesses get more business, higher profits, without just spending more time and burning out.

Many people think you can only do one thing or another.

Have a job or be an entrepreneur.

Have a job or retire.

Get a job or go to school.

But here’s the great thing.

In this digital age, it has never been easier to do both.

You can have a job AND a side hustle.

You can build a side hustle while you’re in school.

You can build your side hustle to prepare for retirement.

You can have a side hustle IN retirement.

It can be something you do for fun.

You can learn things from it you could never learn in your day job.

You can learn things to apply to your day job and make you even more valuable.

You can pay off credit card debts and student loans.

You can build a vacation fund.

You can build your emergency fund so if you lose your job you’re not out on the street living out of dumpsters.

Ultimately, this helps you do each transition better. It gives you flexibility to learn as you earn. And figure things out while you’re handling the rest through your day job or schooling. You can see how you like it. You can make new friends as you help each other along. You don’t have to work in isolation if you’re working from home on this.

Is this for you? Only you can decide. But I want to open your eyes to the possibilities.

Thinking a side hustle might be worth checking out? Shoot me an email and we can discuss your situation specifically.