There are a lot of things in your life that wil change a lot after retirement. Not just your daily life, as well the way you have to manage your financial situation will be different then before. Your pension is a collective noun for a certain amount of money that you will receive every month, when your working life ends. The amount of pensioen you will receive after retirement depends on several factors. Do you know what will be your retirement income?
Different sum everybody
Calculating your pension can be really confusing and there is a different sum for everybody. This sum varies depending on your working years, wage, age and living situation.
These factors can all have a big impact on the pension you will receive. Do you prefer to be in control? Then make sure you make a plan on how to manage your finances.
Your pension can be arranged by different institutions, like employers, insurance companies, unions, government etc.
In the US one can retire at the age of 65. However, this will change in the future as the age will go up every five year.
Are you born after 1960? Then your retirement age will be 67. In case you decide you want to retire before the
approximate age, which is possible, then you will lose some of retirement income. You van calculate it yourself:
- You want to retire at 62, instead of 65. In this case you will lose 1% for every month you work less. This means you will receive 80% of your regular pension.
- You want to retire at 62, instead of 66. In this case you will receive 75% of you regular pension.
- You want to retire at 62, instead of 67. In this case you will receive 70% of you regular pension.
Beside the regular pension there are as well certain other options. For example setting up a private pension fund. These funds are most usually put up by companies as an extra for its employees. Beside that there are three basic options: defined contribution plan, defined benefit plans and hybrid,- and cash balance plans.
Chances are you might worry about weightier or not your pension will be enough for you to life of. You might want to travel, support your children or start a new hobby. It that case it might be smart to thinks about other financial options like index funds, personal savings, selling your house or starting a new business after retirement.
If you want to know which options are best for you, it might be best to consult a specialist in time. There you can go through the options and find the solution best suited for you.