Whats Your Plan for Retirement?

Let’s face it most everyone makes that first step toward retirement by choosing the age when you WANT to stop working. But unfortunately, that becomes their last step, while it’s only the beginning when it comes to their retirement planning.  We are here to remind you what more is required in order to achieve that dream, that dream of the age you wish to retire.

This dream is going to require a plan and when it comes to finances, plan is a four-letter word to most people.  If you’re in your 40s or 50s and you haven’t started thinking about how you will actually achieve your retirement and what you’ll do when you stop working, let’s look at the five most common mistakes so you can decide if it’s time to get serious.

The five major reasons why people are forced to keep working far longer than they expected:

1.     Underestimating how much money you’ll need

While it’s hard to guess how much money you need to save to retire comfortably, it’s probably more than you realize. Generally, you’ll want to cover 70% to 90% of your working income with a combination of your savings and Social Security. If that’s more than you thought, it gets worse. The Economic Policy Institute has found that the median retirement savings for Americans between ages 56 and 61 is just $17,000. Further, more than 40% of baby boomers approaching retirement don’t have any savings at all.

2.     High living expenses

Many people have difficulty saving for their retirement because their cost of living is too high and they don’t have much left over for retirement savings after paying bills. Some dream of getting by with a smaller amount because they plan on transitioning to a thrifty lifestyle once they retire. Unfortunately, this assumption has two flaws:

First, not putting money aside now is just postponing the fact that you must put money aside. If you don’t do it now, you’ll have to do more later. That will almost certainly mean having to work past your projected retirement age.

Second, it’s harder to give up an expensive lifestyle with a big house and nice car than you might imagine. The longer you have it the harder it is to part with. If you reach retirement age and realize you want to keep these luxuries, you’ll have to keep working to save extra for a more comfortable retirement.

3.     Overspending on housing

Apartment living is very common in Europe and other parts of the world, but it doesn’t really jibe with the white-picket-fenced American Dream. If you’re living in the United States and you own a house, there’s a good chance it’s bigger and more expensive than you need. A report from the Joint Center for Housing Studies at Harvard found the number of Americans who can’t afford their homes jumped 146% from 2001 to 2017. The problem begins during house shopping, when people fall in love with a house and then start pulling strings to see how they can pay for it. Unfortunately, this results in mortgage and maintenance costs that leave little money for retirement savings or investing.

4.     Investing too aggressively or not at all

The search for bigger returns leads many people to invest heavily in stocks, which yield higher returns than savings but are riskier thanks to market volatility.  It’s coming on 10 years of superior market gains.

5.     Not having a plan

Many people choose an age that seems best to retire and leave their “retirement plan” at that.

However, if you don’t create a solid plan for your retirement, you may find yourself a year or two away from it and you won’t be ready. You may not have enough saved or you might not have thought about what you’ll be doing with all your free time!

Read on to see how you can fix these issues and increase your chances of retiring on time:

1.     Accelerate your savings

If you’re behind on your savings, you should still be able to retire on time if you increase how much you’re saving during your last 10 years of work. You can accomplish this without entirely devastating your current plans and lifestyle. How?

2.    Cut your lifestyle spending

So, what’s the solution? Simple: begin to gradually decrease your lifestyle spending ahead of time. Look at how much you make a month. Driving the newest car can be expensive, and so are cable TV, premium mobile phone plans, and eating dinner out several times a week. If you begin to cut down on your monthly spending, you’ll have more money left over to put into your saving account, a CD, or another investment that will get you to your savings goal faster.

3.     Downsize

If having a bigger house than you need is making it impossible to save for retirement, then consider downsizing in the years before you stop working. This will allow you to put more of your income toward your retirement and increase the chances that you will be able to retire on time. Downsizing earlier will also make your transition to budget-friendly retirement living easier.

Finally, keep in mind that the city where you choose to retire can make a big difference in the quality of life you can achieve with your savings and Social Security.

4.     Get higher returns on your money

Putting your money in a certificate of deposit is a good middle ground that gets you higher returns than regular or high-interest savings accounts while avoiding most of the risk that comes with investing. When you lock your money down for one to five years in a CD, you’re locking into a particular interest rate. The risk is that if interest rates go up, the interest on your money won’t — because you’ve locked in. To reduce this risk, you can consider putting your money in a one-year certificate of deposit that will lock in the interest rate but won’t force you to stick to it for too long if interest rates do go up. The next year you could simply put your money in another one-year CD and reap the benefits of higher interest all over again.

5.     Create a retirement plan

A retirement plan should begin with how much money you think you’ll need each month to cover housing, food, and other monthly costs that will ensure a comfortable lifestyle. Cross-check this with your sources of income, including your Social Security, savings, and perhaps part-time work. If there is a gap between needs and how much money you’ll have each month, then you’ll need to fill it by padding out your retirement savings and possibly working a few years longer than you originally planned. It won’t be the end of the world if you have to work a few extra years before you retire, and it’s best to make the most of it. The less time you have until retirement, the more important it is to gain the highest returns possible on your money, including from CDs.


Whether you are a business, individual, or non-profit – we will outline specific steps you can take to minimize taxes, maximize loan eligibility, or enhance the value of your property. With one call or email we will provide you with a professional, complimentary financial Statement evaluation – no obligation. Just visit Czarbeer.com/offer or contact us at info@czarbeer.com, or call (212) 397-2970 and we will be happy to help you and answer your questions.