Dec 02

The U.S. Department of Labor released some tips, on how to prepare for your retirement. It doesn’t matter how old you are now; actually the younger you are – the better! Okay, some tips apply for US citizen only. Anyway, here they are:

1. Know Your Retirement Needs

Retirement is expensive. Experts estimate that you’ll need about 70 percent of your preretirement income – lower earners, 90 percent or more – to maintain your standard of living when you stop working. Take charge of your financial future. Start by requesting Savings Fitness: A Guide to Your Money and Your Financial Future.

2. Find Out About Your Social Security Benefits

Social Security pays the average retiree about 40 percent of preretirement earnings. Call the Social Security Administration at 1.800.772.1213 for a free Social Security Statement and find out more about your benefits at

3. Learn About Your Employer’s Pension Or Profit Sharing Plan

If your employer offers a plan, check to see what your benefit is worth. Most employers will provide an individual benefit statement if you request one. Before you change jobs, find out what will happen to your pension. Learn what benefits you may have from previous employment. Find out if you will be entitled to benefits from your spouse’s plan. For a free booklet about protecting your pension, request What You Should Know about Your Retirement Plan.

Top 10 Ways To Prepare For Retirement

4. Contribute To A Tax-Sheltered Savings Plan

If your employer offers a tax-sheltered savings plan, such as a 401(k), sign up and contribute all you can. Your taxes will be lower, your company may kick in more, and automatic deductions make it easy. Over time, compound interest and tax deferrals make a big difference in the amount you will accumulate.

5. Ask Your Employer To Start A Plan

If your employer doesn’t offer a retirement plan, suggest that it start one. Simplified plans can be set up by certain employers. For information on simplified employment pensions, order Internal Revenue Service Publication 590 by calling 1.800.829.3676. Or you can view a copy on the IRS Web site. You may also want to request a copy of Choosing a Retirement Plan for Your Small Business.

6. Put Your Money Into An Individual Retirement Account

You can put up to $3,000 a year into an Individual Retirement Account (IRA) and gain tax advantages. The chart below illustrates the way your account can grow in an IRA.

The Advantages of Starting Early-Start now! This chart shows what you would accumulate after 5, 15, 25, and 35 years if you saved $3,000 each year and your money earned 7% annually.

When you open an IRA, you have two options – a traditional IRA or the newer Roth IRA. The tax treatment of your contributions and withdrawals will depend on which option you select. Also, you should know that the after-tax value of your withdrawal will depend on inflation and the type of IRA you choose.

7. Don’t Touch Your Savings

Don’t dip into your retirement savings. You’ll lose principal and interest, and you may lose tax benefits. If you change jobs, roll over your savings directly into an IRA or your new employer’s retirement plan.

8. Start Now, Set Goals, And Stick To Them

Start early. The sooner you start saving, the more time your money has to grow. Put time on your side. Make retirement savings a high priority. Devise a plan, stick to it, and set goals for yourself. Remember, it’s never too early or too late to start saving. So start now, whatever your age!

9. Consider Basic Investment Principles

How you save can be as important as how much you save. Inflation and the type of investments you make play important roles in how much you’ll have saved at retirement. Know how your pension or savings plan is invested. Financial security and knowledge go hand in hand.

10. Ask Questions

These tips point you in the right direction. But you’ll need more information. Talk to your employer, your bank, your union, or a financial advisor. Ask questions and make sure the answers make sense to you. Get practical advice and act now. Financial security doesn’t just happen. It takes planning and commitment and, yes, money.


  • Today, only 42 percent of Americans have calculated how much they need to save for retirement.

  • In 2001, of those who had 401(k) coverage available, 30 percent didn’t participate.

  • The average American spends 18 years in retirement.

Putting money away for retirement is a habit we can all live with. Remember … Saving Matters!

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written by Chris

17 Responses to “Top 10 Ways To Prepare For Retirement”

  1. stuartNo Gravatar SLOVAKIA Says:

    Sweet reading!!!!

  2. TomNo Gravatar UNITED KINGDOM Says:

    although, for aspiring nomads, this would smack of “rat-race”! lol!

  3. ChrisNo Gravatar INDONESIA Says:

    How true actually! Although a bit planning ahead is better than no planning at all. You could also use the Rat Race to your advantage, like planning to work 10 years full power and saving what you need to live nomadic after. That’s what I did, although the initial 10-12 years became 14 years in the end. So yeah, pulling through with that could mean quite some frustration and hardship as well, plenty of discipline and doubts – nothing you necessarily want to start with, but hey – it’s even harder to create something out of nothing. ;-)

  4. RaviNo Gravatar CANADA Says:

    How do you calculate how much you need to retire????

  5. ChrisNo Gravatar INDONESIA Says:

    Ravi – that is a good question and one that has a different answer for everyone. It really depends on your current standard of living/savings/family situation/passive income streams you already have, your future material demands and needs, the country where you are planning to retire, your health status and other factors. I wrote a few more detailed posts about it, you might want to click on the ‘money’ or ‘retire’ category on the upper top left part of the site and scroll back through some of the existing posts. If you have detailed questions, let me know and I’ll try to help you find an answer that works for you. ;-)

  6. ryan ZoupNo Gravatar SINGAPORE Says:

    haha geting old always worry for retire =))

  7. robertNo Gravatar SINGAPORE Says:

    if you choose to retire in SE and S Asia, it is very easy to know the minimum monthly expenses..(US$500?)..BUT the difficult part is as you grow old….you tend to fall sick(?)…and it is not possible to know how much the medical expenses…. be prepared to set aside a sum for this contingency….or get back to your home country for free treatments? ha!ha!..

  8. ryan ZoupNo Gravatar SINGAPORE Says:

    hihi there robert,so funny prepare for retire hehe :D

  9. robertNo Gravatar SINGAPORE Says:

    ryan, i am not preparing to retire..i am already happily retired. how about you? still accumulating wealth in little red dot…

  10. ryan ZoupNo Gravatar SINGAPORE Says:

    yes robert,you remind one of my friends always said “koukla,,,,,,”.so you now retire haha what thing is it and you happy :D i am happy too

  11. robertNo Gravatar SINGAPORE Says:

    ryan, i am happy that i did not die young and rich… why are you so happy? checking the money every now and then..the money you may not have the chance to use….or happy working just to survive…ha!ha!

  12. ryan ZoupNo Gravatar SINGAPORE Says:

    yes robert,certainly no,i still study in singapore before i work in travel agency jakarta under sriwijaya air,why i am happy because i love to do in my day,i dont checking the money and i dont working yet but my money i invest in my home town to make a small bussines,i buy boat for make money,and one cafe so i dont work ;-)

  13. robertNo Gravatar SINGAPORE Says:

    ha!ha! ryan, now i know you are only a kid…get an education first! don`t talk about retirement.. 99.99% of indo do not retire….

  14. ryan ZoupNo Gravatar SINGAPORE Says:

    haha roberts,rigth the first thing i go to this blog because chris put website about lombok travel and i open about gili islands picture so interesting to read and finally go trought to this chat.haha for sure is fun HEhe……………yep dude because indo happy life HU!ha! =))

  15. Shane DelarosaNo Gravatar UNITED STATES Says:

    Before you retire, you must be able to determine if you are satisfied with what you had contributed and you must be willing to face a new life.

  16. sicknoteNo Gravatar UNITED KINGDOM Says:

    Shane…..I do not give one thought to what I have contributed.

    Before you retire, you must be able to determine that you have enough money to see you into your grave. Thats all I worry about.

  17. BrookeNo Gravatar CANADA Says:

    Plan ahead. That is the main thing that you need to do. Once you have good plans, I am sure you will have a good retirement.

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