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Have You Created Your Retirement Road Map?

March 30, 2022

One of the most complex parts of preparing for retirement is thinking about life where working and building income isn’t the main focus. At times you may become so overwhelmed thinking about saving for an unknown future that you end up not saving anything. You need a road map that can change course if necessary but keeps you headed toward your intended destination. 

Before you hit the road, you’ll need to think about what your life might look like in retirement. Then start to estimate how much everything will cost. Since you can’t accurately predict future prices, use inflation as a benchmark—the average inflation rate in the US over the past century (1913-2013) was 3.22%. So it makes sense to plan for higher prices in the decades ahead.

You’ll also want to factor in your day-to-day expenses, like housing costs, food, and healthcare. Some of your current expenses, such as a mortgage or childcare, may no longer exist but could be replaced by new ones.

Some expenses to factor into your calculations:

  • Housing costs, including rent or a mortgage, heating, water, and maintenance
  • Healthcare costs
  • Day-to-day living, such as food, clothing, transportation
  • Entertainment, including restaurants, movies, plays
  • Travel, including flights, hotels, gas if driving
  • Life and/or long-term care insurance

Income you could receive in your post-working years:

  • Pension income
  • Employer-sponsored retirement plans
  • Social security
  • Home equity
  • Rental property income
  • Owned-business residuals 

Match up revenue and expenses, and you’ll get a good idea of what you’ll need to set aside for every year of your retirement. If you discover you may fall short, it could be time to look at ways to increase your net worth now. While your investment portfolio is a big part of the net worth equation, it’s not the only thing that can potentially contribute to your financial well-being in retirement. Here are four ways to increase your net worth.

Buy a house: a house can end up being your most valuable asset, and many people do sell their home later in life and use that money to help fund their retirement goals.

Pay down debt: Decreasing debt increases your net worth, so, over time, do what you can to pay down your mortgage, pay off your car loan and reduce any credit card debt.

Remember to save: Earmark funds for the future to systematically go from your bank account into your investments. By doing it this way, there’s no risk of you spending that money.

Invest in the market: One reason to invest is to take advantage of the power of compounding. Over time, that compound growth can boost returns. 

Preparing now can make a significant difference when you finally reach your retirement.

As we said, your road map to retirement won’t move in a straight line. Everything from your net worth to your investments to your retirement plan will ebb and flow along the way. Give us a call today and let us help you create a reliable road map.


This document is for educational purposes only and should not be construed as legal or tax advice. One should consult a legal or tax professional regarding their own personal situation. Any comments regarding safe and secure investments and guaranteed income streams refer only to fixed insurance products offered by an insurance company. They do not refer in any way to securities or investment advisory products Insurance policy applications are vetted through an underwriting process set forth by the issuing insurance company. Some applications may not be accepted based upon adverse underwriting results.  Death benefit payouts are based upon the claims paying ability of the issuing insurance company. The firm providing this document is not affiliated with the Social Security Administration or any other government entity.

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