One of the more difficult issues in retirement planning is how much to save before retirement. Here at Regents Park, We see 1,000s of different portfolios every year. Everyone is unique and everyone has different needs, but we do see some common things that make us concerned because we see them too often.
One of the challenges many baby boomers have is what they’ve been taught is just wrong; therefore, they have made considerable investment mistakes. The Average Baby Boomer has a retirement portfolio that includes.
(According to Real Vision Data of baby boomers)
- Bonds: $24,000
- Stocks and Retirement Plan: 269,000
- Home Equity: 300,000
- Savings: 107,000
- Pension Plan: 260,000
- Miscellaneous assets:100,000
This totals out to be a retirement of about one million. There are two main problems. First, one million can be tough to retire on. With inflation and taxation on the rise and an uncertain amount of time the money is needing to last, there is no guarantee that your retirement will be comfortable and easy. Second, the numbers are skewed. The numbers above are the average, however, take a look when we view the median Baby Boomer retirement portfolio without the top one percent.
(According to Real Vision Data of baby boomers)
- Bonds: 4,000
- Stocks and Retirement Plan: 45,000
- Home Equity: 53,000
- Savings: 18,000
- Pension Plan: 44,000
- Miscellaneous assets:20,000
Totaling roughly $200,000 the median Baby Boomer is trying to retire on. Trying to retire on this amount is extremely difficult, and scary, not to mention they are also subject to rising taxation and inflation. We realize this is fundamentally a saving, and money management problem.
Baby Boomers were raised by an extremely frugal generation. Those parents who experienced the effects of the Great Depression, and post-war eras saw what it was like to have nothing, as a result, they spent nothing. Because of these experiences, this very frugal group of parents raised a Baby Boomer group that just didn’t want to be as austere or as frugal, as their parents. This has resulted in over-investing and taking large losses during the 2001 internet bubble, and the 2008 housing crash, or simply not planning at all.
If you are worried about your retirement plan, give us a call. Regents Park can help you think through your situation and plan a path forward. We have decades of experience solving these issues and helping people just like you. Learn more about Non-Linear investing, reach out to our service team, or schedule a meeting with one of our investment advisors. We are here to help you “Live Differently®.”
Thank you.
