On the surface, retirement planning hasn't changed all that much over
the years. You work, you save and then you retire. But while the
mechanics may be the same, today's savers are facing some challenges
that previous generations didn't have to worry about.
First of all, life expectancy is longer, which means you'll need your
money to last longer – potentially into your 90s. Bond yields are also
much lower than they used to be, which means you can't buy a few fixed
income instruments and earn a double-digit return. Then there is the
health crisis due to the coronavirus pandemic.
This is compounded by the fact that more companies are moving away from
defined benefit pensions —which guaranteed you a certain amount of money
in your golden years — to defined contribution plans, which are more
subject to market ups and downs.
So, how can you have the retirement you've always wanted? After all,
retirees want to experience all the things they couldn't do when they
were too busy working. Exotic travel vacations, marathon running, novel
writing, spending more time with friends and family — the possibilities
are almost endless. There are several steps, which we explain in this
retirement guide, from budgeting and setting goals to choosing the right
retirement savings account that will help you map out a plan that's
right for you.