Budgeting for Retirement

older couple budgeting for retirement

Because no one truly knows how much money they will need for retirement, saving and planning for it can be daunting. To help you and your employees budget for retirement, I want to share 9 tips from our financial counseling partner, BALANCE Financial Fitness Program:

  1. Think about what your retirement will look like

    Will there be a lot of lazy days in a hammock? Or do you see yourself on the go a lot, travelling to new destinations? Write down some of the goals you have for your retirement. Visualizing your future lifestyle will help a lot in creating a realistic forecast of which of your expenses will go up and which will go down in retirement.

  2. Examine your current expenses first

    Before you can estimate what you will be spending in retirement, you need to have a realistic assessment of what your costs are now. Track your expenses for a month to give yourself a baseline figure.

  3. Determine your expenses in retirement

    This is where that list of current expenses comes in handy. Not only does it give you a jumping off point for determining your future expenses, but it also helps you start to identify some of the expenses you can cut in retirement.

  4. Remember to include all sources of income

    There are many ways people earn income in retirement, including employer retirement plans, individual retirement plans, pensions, annuities, investments and part-time jobs. Be sure to include all of these in your budget figures.

  5. Give the budget a test run

    One way to see if your retirement budget will be livable is to try to stick to it for a month or two. Track all your expenses and see if you are able to stick to what you have projected.

  6. Do multiple budgets if necessary

    There may be events happening during retirement that will change your financial situation. For example, you may pay off your house. Or you might feel like you want to work part-time for five years and then fully retire after that. Or maybe you will receive a sizeable inheritance.

  7. Take advantage of free calculators

    With factors like inflation and compound interest affecting your future numbers, it can feel nearly impossible to calculate what your money will be worth or what things will cost at the time of your retirement. Visit balancepro.net for financial calculators to help you get a clearer picture.

  8. Decide when you will retire

    One simplified way to determine when you have enough to retire is when the amount you will be able to have in monthly income meets what you project for monthly expenses. If you aren’t there yet, consider ways to amass more money for your retirement. A tip: If you are trying to max out your Social Security benefits, there is a calculator at ssa.gov that shows how much you will receive based on what year you retire.

  9. Get help

    This is a big task to take on by yourself. Contacting a financial counselor, certified financial planner and/or tax professional can help you check your work and get fresh ideas for making the most out of your money.†


†Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Hanscom Federal Credit Union is not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Hanscom Investment Services, and may also be employees of Hanscom Federal Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Hanscom Federal Credit Union. Securities and insurance offered through LPL or its affiliates are:

Not Insured by NCUA or Any Other Government Agency / Not Hanscom Federal Credit Union Guaranteed / Not Hanscom Federal Credit Union Deposits or Obligations / May Lose Value

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About Author

Maria Porto
Maria Porto

Maria Porto is Hanscom FCU's assistant vice president of partner relations. She may be reached at mporto@hfcu.org.

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