You may be interested in the article published in USA Today on January 31, 2014. The article discussed President Obama’s proposed MyRAs. While the MyRA may not be of immense interest to most taxpayers, I found the article of immense interest because the author, John Waggoner, spoke about the retirement crisis we have in this country and said that “A large number of people who have worked all their lives can look forward to living in near-poverty when they retire.” If his gloom for the future was not alarming, he said that “it’s already happening” in that “23% of married couples and about 46% of unmarried couples rely on Social Security for 90% or more of their income.” He stated that the average monthly Social Security payout for retired workers is $1,269.
Living on $15,228 a year ($1,269 X 12) can be quite a challenge. Okay, but you have a 401(k) or other retirement plan to supplement your retirement. Mr. Waggoner states that according to Fidelity Investments the average 401(k) balance is $84,300. If the retiree lives 30 years, that $84,300 may yield another $2,800 allowing Mr. Average to live on $18,000 per year.
Unfortunately, far too many people begin to think of retirement planning when they approach retirement in their sixties. As stated in this article, the “key to having a successful retirement is saving early and often.”
When you meet with your tax professional this year to have your return prepared or reviewed, why not ask him to review your retirement savings plan? Remember that Social Security was designed to supplement your retirement savings, not to be your primary source of retirement benefits. As employers are phasing out traditional pension plans, it is most important that you begin to address your retirement needs today rather than later.
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