Target Savings Numbers for Retirement: Are You On Track? | Mission Wealth Management

the last time we had Seth streer on the show we ended our conversation by talking about retirement and by showing some savings Target numbers that may have taken a lot of people by surprise Seth is with Mission Wealth Management in Santa Barbara and he’s back to recap those numbers and to talk about how we can maybe achieve some of these numbers because it certainly took me by but I was glad I got to see them because let’s talk real reality right when it comes to money exactly so let’s throw that graphic up and show folks what we were talking about and you did a very nice job at uh at divvying up uh how depending on how much we make and how old we are how much we should be saving so that we can live the life of a $60,000 a year individual once we retired right exactly so take for example age uh what I’m closest to 35 if I make $50,000 a year I should be saving $1,272 a month at least exactly saving that much a month per month exactly and that’s assuming that you can earn an 8% average rate of return and that inflation remains low at 3% so even in that case there are a lot of factors

involv so that’s a minimum and in part is because of the fact that the social security and and pensum plans that whole phenomenon the other two legs in that Triad exactly are just not Dependable right exactly and maybe as that Paris Hilton video created some awareness for people this graphic can also create some awareness which is the fact it comes down to we have to control our future and we have to be the ones to really look at what we’re doing today and say if we keep doing what we’re doing will that get us to where we want to be in the future good point and also by the way dramatically shows how the older you are you know when you start saving the the more you’re going to have to save so start early it’s never too early to start saving all right so the question is now you’ve shown us the numbers and you’ve gotten our you’ve got our attention now what do we do to get to that point exactly it’s a great question well I think the first step Gabe really is to have that awareness and really open your eyes and wake up and say if I keep doing what I’m doing will I get to where I want to be in the future and if

not you either need to reframe your perspective of where you’ll be in the future or you need to take action so it really comes down to taking action and I’d say the first step with that is to seek counsel get advice maybe it’s a member maybe it’s a friend someone you trust who you know is successful at at accumulating wealth and managing wealth or maybe it’s a professional firm like ours but make sure you get professional help to say hey if I’m not on track what do I need to do to get there right and it’s got to be someone that you trust there’s but that hope that personality factor is key to me I think because you got to be able to trust what you’re saying absolutely you have to trust them you have to relate to them and you have to know that they have expertise all right and I like your personality so we got that that thing done um what about what a lot of people will do is they’ll let their emotions maybe get in the way and they’re think I am doomed uh could it be that maybe it’s not as bad as people think when even when they’re looking at some pretty dramatic numbers absolutely and that’s why we think it’s

so critical as a first step is to start with a financial plan because in the financial plan we often find that clients might have a number of factors that really already put them ahead of the game of where they thought they were with regard to achieving Financial Security so a couple examples of that might be if they own real estate maybe they might turn that real estate into a rental property some point in time or maybe they’ll downsize out of Santa bar Barb and move to another location and have home equity there to utilize we’re also seeing a number of people uh that are receiving inheritances that will really impact their financial future as well as maybe working part-time into retirement and having some level of of income in the future or future career opportunities where they might have higher earning power in the future to be able to save more talk to me about a Roth IRA what is it and who who should consider maybe opening one up aroth ra is a great Tool uh if any viewers have not learned about it they really should um it’s an after tax savings vehicle and the monies that you put into the Roth

IRA will accumulate tax-free meaning they will grow tax deferred and then upon distribution they’ll be tax-free distributions unlike a qualified plan where when you make distributions their taxable ordinary income a Roth ra is taxfree right there are certain limitations as to who can contribute to them but if you qualify it’s a great great tool another recommendation that you gave me which is a no-brainer is throw more money into in your 401k it’s a no-brainer it really is I mean every dollar you put into your 401k saves you 30 to 40 cents in taxes um on that dollar and then that money accumulates tax deferred maybe there’s an employer match as well it’s a it’s an automatic contribution so it’s out of sight out of mind it’s an easy way to save so I would challenge every viewer to increase their contribution maybe even 1% call tomorrow increase at 1% and that’ll be a step in the right direction all right there’s more to talk about their cess contact info 882 2360 or Mission wealth.com