With help from your financial advisor, you mapped out your future in retirement—pinched pennies, saved and invested throughout your career. But, what happens if you’re forced to hang up your hat early? This, unfortunately, is the harsh reality for many workers.
A large percentage of retirees, nearly half (48 percent), left the work force earlier than planned, according to the Employee Benefit Research Institute. The number one reason was because of health problems or disability.
4 Tips to Prepare for Early Retirement
Statistics show you can’t always plan to work longer to make up for savings shortfalls. Prepare for the unexpected with these four tips:
1) Assess your financials to get an idea of where you are today and the impact of early retirement. Review your cash flow, balance sheet, insurance and estate plans. Answer this question: What would happen today if you were to retire unexpectedly?
2) Ensure you have an adequate emergency fund. Save enough money to cover four to seven months’ worth of expenses. Review your cash reserve annually to make sure it still fits your current needs.
3) Eliminate “bad debt.” Review how much debt you have along with interest rates. Pay down debts with the highest interest rates first. You don’t ever get back the interest you pay over the life of a loan, so that means more money out of your pocket.
4) Contribute to your retirement accounts. A few suggestions include: (1) Maxing out your 401(k) by contributing up to $18,500; (2) For workers age 50 and older, making catch-up contributions of up to $6,000 to your 401(k), bringing your total maximum contribution for the year to $24,000; and (3) maxing out your IRA or Roth IRA by contributing up to $5,500 (or $6,500 for workers age 50 and older).
Prepare for unexpected early retirement with Busey Wealth Management. With your financial future in focus, our team of professionals can help you determine optimal investments to meet your goals. Contact us today or call 1.800.67 | Busey and visit busey.com for retirement planning articles and calculators.
Investing involves risk and you may incur a profit or loss regardless of strategy selected. Be sure to contact a qualified professional regarding your particular situation before making any investment or withdrawal decision. You should discuss any tax or legal matters with the appropriate professional.
Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC, and are not insured by bank insurance, the FDIC or any other government agency, are not deposits or obligations of the bank, are not guaranteed by the bank, and are subject to risks, including the possible loss of principal. Investment Advisory Services offered through Raymond James Financial Services Advisors, Inc. Busey Bank, Busey Wealth Management, and Busey Investment Services are not registered broker/dealers and are independent of Raymond James Financial Services.
This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. Opinions are not necessarily those of Raymond James. The information has been obtained from sources conserved to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete.
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