The money division of U.S. News notes that an individual can determine how much money he needs to save for retirement by calculating how much he needs to spend either every month or every year of retirement. An individual should also consider how much health care may cost him when he retires and make adjustments for the money that is no longer being saved for retirement.Know More
Besides accounting for the money that is no longer being saved up for retirement, an individual should also factor in his payroll tax as well as any lifestyle changes that may be made upon retirement.
As of 2014, financial experts predict that a majority of individuals need roughly anywhere from 75 to 80 percent of income before retiring to retire in financial comfort, notes U.S. News. An individual should also factor in the recurring income he receives through Social Security, pension, royalties and rent if he owns real estate property or plans on renting out rooms.
It is best if the final calculation is either zero or a negative number after an individual's income has been subtracted from his expenses. If the calculation is positive, then there is more than likely an income gap that needs to be accounted for because a majority of retired individuals has more expenses to take care of than income, according to U.S. News.Learn more about Financial Planning
An individual can withdraw the entire 401(k) balance in a lump-sum distribution immediately after retirement, says CNN Money. Other options include rolling the money into an Individual Retirement Account (IRA), purchasing an annuity or asking for periodic disbursements.Full Answer >
An individual with a 403(b) retirement plan who becomes disabled can withdraw money from the account without penalty, reports the Internal Revenue Service. The distributed funds are subject to regular income tax. Most plans allow employees to take out money in a lump sum or in periodic payments.Full Answer >
To retire at 50, a person must live below his means and adhere to a strict budget, while also saving and investing a significant portion of his income. To establish savings, it is necessary to cut expenses and increase earnings. A retiree can increase retirement savings by getting less-expensive housing.Full Answer >
As of 2015, workers can retire at age 62 if they take reduced monthly Social Security benefits, according to the Social Security Administration. They can offset receiving less in Social Security by paying off their mortgages and maximizing other retirement benefits such as 401(k) accounts and health savings accounts, explains Forbes.Full Answer >