Home Retirement I’m 67 & saved $380,000 for retirement but I’m ‘concerned’ that it won’t be enough so an expert said to ‘shoot low’

I’m 67 & saved $380,000 for retirement but I’m ‘concerned’ that it won’t be enough so an expert said to ‘shoot low’

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AMERICA’S population is aging, and many Baby Boomers are entering their golden years.

Retirees often need significant financial advice to feel ready to make the jump into retirement.

Drew Blackston projected how far into the future the retiree could afford to liveCredit: YouTube/Your Financial EKG

One 67 year old retiree with $380,000 saved for retirement told a financial advisor that she was “concerned” about how far her money would go.

The anonymous woman, who retired early at 62, contacted certified retirement counselor Drew Blackston for help.

In a YouTube video, Blackston analyzed her finances and projected into the future, with some key tips.

THE SITUATION

The woman said she had $492 per month coming in thanks to Social Security.

Social Security payments get a cost of living adjustment, or COLA increase, every year.

“I’m gonna shoot low,” Blackston said, estimating that the number would rise about 1.5% on average.

He used this conservative strategy throughout the process.

Her pension paid 2,498 per month.

But her expenses raised alarms for her. She said she was spending $4,844 per month, thanks to inflation.

“This is really why she called,” Blackston said. “She’s concerned at 67 years old.”

THE SOLUTION

Blackston used math to project how long the client’s money could last her comfortably.

Thanks to her high expenses, she would need to take money out of savings every month.

Luckily, Blackston pointed out, not all of her expenses were subject to inflation.

Her home loan and car loan, for example, are at a fixed price.

Extrapolating her finances out over the coming decades, he determined how much money she would have in the future.

The solution was in her savings.

She had $97,000 in the bank, $74,000 in an IRA, and $208,000 in an individual investment account.

Blackston advised that the client take $67,000 out of the bank and put it into her investments.

By doing this, she could make money in the form of interest.

The S&P 500 — a group of stocks often used as a proxy for the stock market as a whole — had an average annual return of about 10% since it was created in 1957.

While predicting based on stock returns can be risky over the short term, the markets generally rise over time.

Using a conservative estimate of 6% growth per year, Blackstone began making his projections.

Based on inflation and her finances, she would have $332,000 in savings by age 77.

She would end up with $262,000 by age 87.

He determined she could make it comfortably to age 92 based on her current habits.

MORE RETIREMENT TROUBLE

A 57 year old recently sought advice on whether he could manage to retire early

With more than $1 million in his 401k account, he was more prepared than most.

A 70 year old with no retirement savings recently called into a financial advice podcast looking for help.

While she did have options based on her assets, they required making difficult decisions.

25% of working adults have no retirement savings, according to The Motley Fool.

One early retiree could lose $400,000 thanks to a key Social Security misstep.

Luckily for retirees, inflation cooled in the 2023.

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