Maintain Your Standard of Living in Retirement
Saving for retirement, and working to maintain your standard of living, is an ongoing responsibility so you don’t see your quality of life drop in your later years. Unfortunately, for many retirees, this goal can be hard to meet. In fact, even with planning, 52% of working-age households may not be able to maintain their lifestyle in retirement.1 You can help avoid this predicament by taking steps today so you can enjoy life how you want, no matter what retirement lifestyle you prefer.
Find ways to improve your cash flow
The balance between your spending and cash flow can make a significant difference in your ability to maintain your standard of living in retirement.2 When you have more money leaving than coming in, you will probably not have adequate funds to afford the lifestyle you desire. Here are common ways to address your retirement cash flow:3
- Identify all liabilities: First, take inventory of all the debt you’re responsible for. These liabilities can include home mortgages, car payments, school loans, and more.
- Calculate all expenses: Next, look at your other expenses. These daily and monthly items can be costs like buying groceries, paying utility bills, and fueling your vehicles.
- List income sources: Now, identify all the ways your household receives income. Sources can vary, and include rental properties, Social Security income, dividend payments, and other income.
- Calculate the difference: From there, calculate the difference between what you pay out and the income you bring in. If you have a deficit, then you will need to find ways to make up the gap — or eliminate your liabilities.
Be Realistic
Unfortunately, not everyone has a clear perspective on their ability to maintain their retirement lifestyle. While only 33% of households realistically see their retirement risks, 19% of households are not worrying enough — and both groups may not take the steps they need to improve their situations.4
You can more effectively improve your standing when you choose to honestly face your financial situation. Not only will addressing your cash flow help you be realistic, but you can also use this Retirement Calculator from FINRA to identify how much money you may need to last your retirement.
No one wants to find themselves in retirement only to see their quality of life decline. How ready you are to maintain your preferred lifestyle depends on your unique goals and financial standing. If you would like to discuss your retirement readiness, we’re happy to talk.
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