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For many people, “retirement” seems like a far-flung pipe dream. However, this golden period of life may come to you sooner than you think.

Therefore, it’s always a good idea to have a retirement plan in place, so you have the capital to live your life to the fullest. If it’s been a while since you last evaluated your retirement plan, you’ve come to the right place.

When assessing your retirement goals and action plan, it may help you to ask yourself a few important questions. We’ve provided a good starting point below. Take the following three questions to heart so you have an idea of where to take your strategies next.

Do I Know How Much I Should Save for Retirement?

One of the biggest mistakes in retirement planning involves going in without a plan. If someone were to ask you, “How much money do you need to retire comfortably?” and you can’t give a concrete answer, it’s probably a good time to assess your plans.

We understand. Planning for retirement can feel like a far-flung goal. However, it’s necessary to have a target savings goal in mind so you can feel confident when the time comes to stop working.

When determining your retirement savings goal, there are many factors to consider. For instance, you need to consider income streams like your current savings, retirement accounts, Social Security, and how other government programs might contribute to your revenue stream in your later years.

Also, there are outstanding living costs you’ll need to consider. Before you retire, you’ll need to think of how your savings will cover a variety of living costs, like:

• Local and federal taxes
• Rent or mortgage
• Groceries and food
• Utilities
• Entertainment
• Healthcare costs
• Travel and hobbies

The above list isn’t exhaustive, but these and many other factors may prompt you to evaluate your retirement savings.

It’s impossible to hit a retirement savings target if you’ve never defined one. While it can be challenging to determine an exact number that you should save for, you can still make an educated guess.

Many financial planners recommend calculating a “FIRE number” to help guide retirement savings strategies. FIRE stands for "financial independence, retire early.” It’s a planning strategy that prioritizes extreme saving and frugality.

A FIRE approach might work depending on your lifestyle preferences and savings goals. While it might not be for everyone, its core objective is still sound. That is, FIRE savers should have a concrete savings goal to aim for before deciding it’s time to retire.

There are many resources online that illustrate how to calculate your FIRE number, the amount of money you should have saved up to retire. Use one of these calculators to get a rough estimate of how much you should save and adjust accordingly.

Am I Taking Advantage of My Employer’s Retirement Benefits?

Many employers implement a variety of incentives to encourage their employees to stay with them. One such incentive is an employer-sponsored retirement plan.

Some organizations offer a company match program in which employees who contribute to a sponsored plan, such as a 401(k), receive additional money from their employers that is deposited into their accounts.

It is highly encouraged to take advantage of employer-sponsored matching programs. Many financial planners will tell you that ignoring these programs is a lot like “leaving money on the table.”

These plans also have tax advantages, depending on which type you take. You should take the time to look over the details and requirements of such plans so you can adjust your savings strategies accordingly.

If your employer offers a retirement plan with a matching contribution, you should do your best to take advantage of it. This is a lot like accepting “free money” that would be hard to come by otherwise. These benefits can also reduce the effort required for your current savings strategy. As a result, some money you’d have to dedicate to retirement savings can go towards other savings goals, like padding an emergency fund or saving for a vital home improvement.

Have I Been Saving Enough Over Time?

Automation, especially for saving and tracking bills, has made people’s lives much easier. While many people will use automation to contribute to emergency funds and retirement plans, it is equally important that you are saving enough money towards your goals that are decades beyond the horizon.

For instance. Let’s say you decided to save $200 a month towards an individual retirement account about a decade ago. While it is always a good idea to save money, it’s equally important to adjust your savings strategy to address current economic conditions. Two hundred dollars ten years ago does not necessarily have the same purchasing power as it does today.

This is all to say that you should adjust your savings strategy over time. Do your best to increase your retirement savings each year to keep up with inflation and the cost of living. While it may not be possible to pin down the exact number you need to adjust, saving more is always a better strategy than saving less.

Retirement planning is a long game, where the players may change with each fiscal quarter. When you have an actionable strategy that can adapt over time, you’re better equipped to face market changes and other challenges. It is highly recommended that you meet with a trusted financial planner to discuss your current situation and develop an actionable strategy that best fits your goals.

First Florida is your partner in planning for your golden years and beyond. Follow our Featured Articles section to get more ideas on retirement planning and make sensible decisions that pave the way to a brighter future.