What is your mission?
Our mission is to guide our clients on their financial journey through all the important transitions of life. Both the good — birth of a child, saving for college, weddings, retirement, and beginning social security — and the more difficult — sickness, disability, a lapse in employment, or death of a spouse.
How much of my income should I be saving for retirement?
This is a question to which investors are often unable to find a clear answer. As you may have guessed, this is because the answer varies significantly from individual to individual. Put simply, there are three primary factors at play: 1. Amount of
Contributions; 2. Time; 3. Rate of return on your investment. A commonly used “rule of thumb” for retirement savings is to contribute 15% of income, over 40 years, with a 7% rate of return.
You may have heard of the 15% rule that says, if an average investor saves 15% of their pre-tax income from ages 25 to 65, then he or she will likely have enough income to retire comfortably. What can be confusing when determining how much to set aside, is that investors often do not start contributing heavily to their 401k or IRA until later into their careers, at ages 30, 35, or 40. Unsurprisingly, a delay in time will likely require an increase in contributions.
There are many retirement calculators available online that can be very helpful, but a good rule of thumb would be for every year of delay from age 25, add 1% to the 15% contribution. For someone who waits until the age of 30, a contribution of 20% to their 401k or IRA would not be unreasonable, and 30% at age 40 with no retirement savings. Keep in mind that many employers match somewhere between 3% and 5% of an employee’s contribution. This will reduce the amount that you will need to contribute to reach your goal.
How can Peters Financial help?
Whether you are just beginning your investment journey, planning for retirement, or have entered your golden years, Peters Financial has an experienced staff that can help guide you financially into your next chapter of life.
PetersFinancial.us
251.342.4874
153 West I-65 Service Road North
Mobile, AL 36608
Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Kestra IS and Kestra AS are not affiliated with Peters Financial. Investor Disclosures https://bit.ly/KF-Disclosure
