How can Gen X avoid outliving their retirement savings? Generation X, the cohort of individuals born between 1967 and 1982, is now between 40 and 55. All in all, Gen X consists of slightly more than 65 million individuals. Fast forward a couple of decades, and the Xers will transition to the golden years of retirement. Living paycheck-to-paycheck should not be your reality moving forward.  

Other interesting names for Generation X:

• “Baby Busters” 
• “latchkey kids” 
• “MTV generation”

Yet, there is a chance some people in this age group will have to work into their 60s, 70s, or even 80s. The burdensome cost of college combined with several economic recessions and seemingly never-ending cost of living increases has made life quite challenging for Generation X, Generation Y, and millennials. 

Financial intelligence is at your fingertips! Get started with Gen X Guide to Retirement Planning, then connect with Sapiat Asset Management today.

Generation X’s challenge is amassing a sizable financial nest egg that sets the stage for living beyond one’s retirement savings. Even in a Pandemic, the Gen X solution to this problem is proactively seeking assistance in comprehensive financial planning provided by a fee-only fiduciary. 

If you are not already working with a financial advisor, are dissatisfied with your current advisor, or feel anxious about outliving your retirement savings, it is time to make a change.

Start Planning for a Better Tomorrow

The worst possible scenario that can unfold after retirement is running out of money and transitioning back to the workforce. With such rapid technological advances, will your skills even be relatable with current practices in your given field? With rapid global evolution, you can avoid such worrisome thoughts by planning your financial future starting today through retirement planning in Tennessee. 

A CERTIFIED FINANCIAL PLANNER™ professional has the experience of disciplined execution and consistent planning to replace any worry with rejuvenating hope.

“As the first fee-only advisor in Greene County, TN, we tap the brightest minds in economics, politics, and finance, which helps us provide better advice.”

Hiring a fee-only fiduciary should be first on your list. This individual has a duty of care to clients first. A fiduciary financial advisor provides advice and makes decisions with the client’s interests in mind instead of self-interest. Instead of raking in commissions for peddling specific investment products, this professional earns a flat fee for service.

Employees of the Tennessee counties should meet with a financial advisor for comprehensive financial planning to help you develop a strategic plan for a comfortable retirement. The aim of this plan includes going over:

• Your life goals
• How people outlive retirement savings
• How you will not outlive your retirement savings
• Helping you understand your long-term retirement benefits
• Types of retirement accounts
• Assessing your 401 k and 457 (if applicable)
• Going over defined benefit plans
• Addressing how you use credit cards
• Determining your preferred retirement age
• Helping you understand the consolidated retirement system TCRS
• General financial education of diversification and investments

Living “the good life” in retirement starts with saving 15% of income now. Begin saving 15% of your salary today, and your financial nest egg will gradually expand.  

Saving money does not have to be limited to depositing money into a bank savings account. The best financial advisors recommend saving cash and investing in diverse securities ranging from stocks in IRAs and 401(k) accounts to mutual funds, ETFs, bonds, money market accounts, CDs, and more.  

Though saving 15% of your earnings for retirement might be challenging, it is a viable goal. The most experienced financial advisors harp on the fact that the average worker requires more than half of pre-retirement income to maintain a decent quality of life after departing the workforce.  

Once Social Security payments are accounted for, nearly one-half of the funds necessary for retirement will stem from savings. Do the math, and you will find it is essential to save 15% during each year of work beginning at the age of 25 to reach the target financial benchmark for a comfortable and lasting retirement. 

Abide by the 4% Rule

Even if you save 15% of your earnings from age 25 until you reach full retirement age (FRA), there is still the potential to run out of money after you transition to your golden years. Your spending rate is just as important as your willingness and capacity to save and invest.  

Retirees who enjoy a high quality of life abide by the 4% rule to estimate the amount of money that can be comfortably withdrawn from retirement savings in a year. Commit to withdrawing 4% or less of your savings per year, and you will be able to transition to retirement without worry.  

In plain terms, the 4% rule means a retiree can withdraw 4% of the money socked away in investments in the initial year of retirement. The withdrawal is then adjusted from that point, moving forward following the inflation rate, ultimately setting the stage to maintain a high standard of living throughout one’s retirement.

Focus on Tax-Advantaged Accounts

Financial advisors provide helpful guidance with a specific focus on investment securities and accounts that serve as bridges to a rewarding retirement. In particular, financial advisors heap praise for tax-advantaged accounts such as traditional IRAs and 401(k) accounts that empower workers to invest pre-tax dollars while working and defer taxes until the money is withdrawn in retirement.  

Roth IRAs and Roth 401(k) accounts are also available, providing an opportunity to invest earnings that have already been taxed to prevent a punitive tax bill after making withdrawals down the line. Your decision between these accounts will ultimately come down to your earnings in the years ahead. 

If you anticipate being in a higher tax bracket after retiring, it makes more sense to pay taxes now as that tax burden will be comparably less.

The majority of employers automatically enroll workers in 401(k) plans. If your employer offers matching contributions, it is in your interest to max out those contributions up until the cap. Opt for automatic paycheck deductions to fund your 401(k), take full advantage of your employer’s willingness to match your contributions, and it won’t take long to amass a sizable financial nest egg that helps you retire with sweet relief.

Obtain Professional Assistance

You can’t do it all on your own. There is no shame in seeking guidance from a financial advisor. Select a fee-only fiduciary financial advisor who has a clean record of success. Comprehensive financial planning aims to analyze your current financial situation and help you develop a sound plan for the future, empowering you for a content retirement.

Ask us how – a CERTIFIED FINANCIAL PLANNER™ is eager to set the stage for your retirement success.

A financial advisor will answer your finance-related questions, address your concerns and help you choose the best investment vehicles for financial success across posterity. This professional will also lend invaluable assistance in processing complex calculations and conducting financial projections tailored to your financial situation and nuanced goals for the future. The time to start is now!

Sapiat Asset Management is a Fee-Only, Independent, Registered Investment Advisor (RIA), specializing in goal-oriented financial planning and investment management for Gen X Individuals & Families, their Businesses, & the Trusts that benefit them and their heirs.