American workers have now arrived at a new day in retirement planning which calls on us to navigate circumstances that are different than previous generations. For example, life expectancy is longer and the money you earn will need to last longer; defined benefit plans (traditional pensions) where you are paid a portion of your salary post retirement, for the rest of your life, is a scarce benefit these days; and the coronavirus pandemic.
Planning for the retirement life you want is still possible but will require a commitment to gaining the knowledge, discipline and discernment to make the choices that will aid and not hinder your retirement goals. There are some items you will need to assess:
How much you need to save for retirement (housing, healthcare, leisure, inflation, day-to-day living)
Your post retirement income (pension, savings, 401K, social security, rental income, if any)
Your plan of action for saving for retirement (budgeting, automatic transfers, establishing an emergency fund and paying down debt
Which investment accounts you should use (high-yield savings account, traditional IRA
Roth IRA, simple IRA, traditional 401(k) plans, Roth 401(k) or Simplified Employee Pension (SEP) Plans
Your investment options (stocks for growth, bonds for safety, alternative asset classes like commodities (gold, oil), mutual funds, index funds and ETFs
Life does not move in a straight line, which means everything from your net worth to your investments to your retirement plan will likely experience a setback at some point. Understand this can and will happen… the key with all of this is to not panic and stick to your plan.