Solving For Fixed Income
Based on the estimated monthly expenses, housing, and Medicare, a household would need to generate the following per month to pay for the essentials.
- Total Monthly Expenses with a Mortgage: $3,829.90 a month
- Total Monthly Expenses With Rent: $3,501.90 a month
You will need a few sources of income coming in monthly to pay for these costs:
- Social Security Income: A couple together would bring in an average of $3,086 per month.
- Level Income Annuity: $175,000 in retirement savings would generate the additional $743.00 a month for life.
- Increasing Income Annuity: $200,000 in retirement savings would generate the additional $743.00 a month for life and increase overtime to help with inflation.
Note* The annuity premium amounts can be lower depending on age and the amount of time deferring in the annuity before starting the income stream. Basically, the longer you wait to start the guaranteed lifetime income, the less money will be required to generate the desired income amount upfront.
You can find your Florida Social Security Administration office here.
Mapped: How Much Money Do You Need To Retire Comfortably In Each State
Having enough savings to afford a comfortable retirement has been an issue for a long time now. In fact, some economists have recently estimated that millennials will face even a harder challenge and should save almost half of their income if they wish to retire at 65. However, the good news is that some parts of the country are friendlier on the wallet than others when it comes to retirement. Our newest visualization shows the average amount that a person will need to retire comfortably in each state, as well as the average retirement age by state.
- The average retirement age in the U.S. is 64 years old. At the state level, the average retirement age varies from 61 years old in Alaska and West Virginia to 67 years old in Washington, D.C.
- The average life expectancy nationwide is 78.6. Among the states, Mississippi has the lowest life expectancy at 74.5, and Hawaii has the highest life expectancy at 81.5.
- Nationwide, the average yearly expenses for someone over the age of 65 is $51,624. Mississippi has the lowest annual expenses at $44,758, while Hawaii has the highest annual expenses at $99,170.
- Taking into account life expectancy as well as yearly expenses, the average savings required for retirement in the U.S. is $904,452. States in the Northeast and the West require the highest savings for retirement, at over $1 million, while states in the South and the Midwest require the lowest savings.
Find Out What’s Happening In West Palm Beachwith Free Real
While budgeting for retirement can be difficult, it is essential for those who want financial security throughout their retirement. Including a small financial cushion for unforeseen expenditures and economic challenges, the average 65-year-old American can expect to spend about $1,067,000 throughout retirement. This takes into account estimated annual spending, a small financial cushion, and life expectancy at 65. Here are 19 things to do if you want to retire early.
Because cost of living and life expectancy differ from state to state, expected spending throughout retirement varies as well. States with higher retirement spending estimates tend to have either higher average cost of living, longer average life expectancy, or both and vice versa.
Read Also: What Age Is Retirement Age
How Much Money Do You Need To Retire In Naples Fl
If you or a loved one is soon to be retired, or retired already, has a decision been made as to where to spend retirement? Wed like to suggest one of the best areas in the entire nation Naples, Florida. Whats so special about this place?
Naples, Florida is situated next to the Gulf of Naples in southwest Florida. Known for its high-end shopping, abundant golf courses, gorgeous sunsets, and pristine beaches, its nothing short of paradise. Naples is, in fact, one of Floridas most desirable residences.
You may be wondering about one important factor where the use of your retirement funds is concerned: How much to retire in Naples, FL? Here, we are going to take a look at retiring in Florida in general. Different towns, cities, counties, etc., will have varied standards of living and costs of living.
How You Want To Live In Retirement
In other words, do you expect your expenses to go down when you retire? We call that a below average lifestyle. Or will you spend as much as you do now? That’s average. If you expect your expenses will be more than they are now, that’s above average.
Let’s look at some hypothetical investors who are planning to retire at 67. Joe is planning to downsize and live frugally in retirement, so he expects his expenses to be lower. His savings factor might be closer to 8x than 10x. Elizabeth is planning to retire at age 67 and her goal is to maintain her lifestyle in retirement, so her savings factor is 10x. Sean sees retirement as an opportunity to travel extensively, so it may make sense for him to save more and plan for a higher level of retirement spending. His savings factor is 12x at age 67.
Recommended Reading: How To Estimate Your Retirement Income
Swimming Pools Are Expensive
Naturally, youll want a swimming pool to beat the Florida heat. Plus, imagine the joy of watching your grandkids splash around under the lanai. And while youre at it, youll want an attached spa to soak those aging muscles.
Just be prepared to pay a pretty penny to keep your pool up and running year round. It costs $177 a week, on average, to maintain a standard 14-by-28-foot pool. Youll also spend hundreds even thousands of dollars on routine repairs to torn liners and leaky plumbing. And if you want your water heated, expect to shell out anywhere from $100 to $600 a month to run a pool heater. Total annual pool costs: $3,000 to $5,000, including maintenance, repairs, electricity, and water.
Oh, and before you call the pool company, realize that since the pandemic began, there’s been such a shortage of materials that some pool firms are penciling you in — for up to two years away.
It’s Not About Money It’s About Income
One important point when it comes to determining your retirement “number” is that it isn’t about deciding on a certain amount of savings. For example, the most common retirement goal among Americans is a $1 million nest egg. But this is faulty logic.
The most important factor in determining how much you need to retire is whether you’ll have enough money to create the income you need to support your desired quality of life after you retire. Will a $1 million savings balance allow you to create enough income forever? Maybe, but maybe not. That’s what we’re going to determine in the next few sections.
You May Like: How Is Retirement Divided In Divorce
Is $50k Per Year Enoughrealistically
Weve shown how people can and do retire with an income of $50,000 per year. But is that a good idea?
For many, its the only option, and its going fine. But that doesnt mean that things always work out. Life can surprise us, and healthcare costs are just one example of risks you face in retirement.
Healthcare
Routine medical care is surprisingly affordable, particularly after you reach age 65 and use Medicare. Yes, weve heard the numbers, such as the need to spend several hundred thousand dollars on healthcare during retirement years. But when you spread that out over a 25-year retirement, it doesnt look as bad. Especially if you have good health, you might be pleasantly surprised.
If you need long-term care , the costs can jump significantly. Thats one of the bigger challenges for retirement planning, and theres no single answer on how to deal with it. You can buy insurance, set funds aside, hope for the best, consider home equity as a safety net, or employ other strategiesbut only time will tell what the best option is.
Taxes
Theres also the question of taxes. Weve ignored taxes in the examples above. The good news is that if you target an income of $50,000, your tax burden might be relatively small. After factoring in a standard deduction , you may be in one of the lower tax brackets.
Inflation
Next Up: Curious About Meeting?
Retirement Can Be Tough On Couples
“Retirement is a major life transition, and you have to be patient with yourself and your spouse, says Patti Black, a certified financial planner in Birmingham, Alabama. Most retired couples do not look like those pictured in ads and commercials. You’ll have to decide how work around the house will change. Will you really share cooking, cleaning and yard work? And do you honestly want to be together 24-7, particularly if you downsize to a smaller home?
These decisions can have serious consequences for a marriage. Gray divorce, or divorce after age 50, has doubled since 1990 while declining across all other age groups, Black warns. And it is most often the wife who asks for divorce after age 50.”
John Waggoner covers all things financial for AARP, from budgeting and taxes to retirement planning and Social Security. Previously he was a reporter forKiplinger’s Personal FinanceandUSA Todayand has written books on investing and the 2008 financial crisis. Waggoner’sUSA Todayinvesting column ran in dozens of newspapers for 25 years.
Also of Interest
Featured AARP Member Benefits
Recommended Reading: How Much It Takes To Retire
Where Does Retirement Income Come From
Many people have various sources of retirement income. These can include investment accounts to protect against inflation, benefits from government programs or continuing paychecks. Generally speaking, its best to have several of these income sources to ensure you have enough to live comfortably.
When considering where your retirement income will come from, one important aspect to think about is the diversification of your portfolio. This can help to alleviate risks in the market and protect your future or current income.
What It Costs To Retire Comfortably In Florida
- Samuel Stebbins, 24/7 Wall St. via The Center Square
The consumer price index surged by 7% in December of 2021, the fastest rate in four decades. Surging inflation is a troubling development for the millions of American retirees relying on fixed incomes and those whose savings are invested in equities markets – and it should serve as a wake-up call for the one in every four American adults with no retirement savings.
While budgeting for retirement can be difficult, it is essential for those who want financial security throughout their retirement. Including a small financial cushion for unforeseen expenditures and economic challenges, the average 65-year-old American can expect to spend about $1,067,000 throughout retirement. This takes into account estimated annual spending, a small financial cushion, and life expectancy at 65. Here are 19 things to do if you want to retire early.
Because cost of living and life expectancy differ from state to state, expected spending throughout retirement varies as well. States with higher retirement spending estimates tend to have either higher average cost of living, longer average life expectancy, or both – and vice versa.
Recommended Reading: How Do You Know If You Can Retire
Where To Retire In Ocala:
There are a handful of 55+ communities in Ocala, but two in particular stand out among the crowd.
At On Top of the World Communities, active adults will find all they dream about and so much more. On Top of the World residents can enjoy any schedule that suits their tastes from activity packed to unhurried.
Leisure amenities include 54 holes of golf on three courses, indoor and outdoor swimming pools, tennis courts, a private R/C flying field, bocce, racquetball and basketball courts, fitness center, health club and spa, restaurants, cultural venues, and much more.
Residents can also participate in over 175 clubs, leagues, hobbies, and lifelong learning opportunities.
There are 23 floor plans available with prices ranging to suit every budget starting from the $200ks.
To Retire In Boca Raton You’d Need A Nest Egg Of $1135625
The typical annual expenses of a retired couple in Boca Raton are roughly $72,425.
To cover these costs, your nest egg would help you generate an income of $45,425 a year at a 4% withdrawal rate, plus another $27,000 from Social Security.
James and Ruth need to save the most money to retire in Boca Raton almost twice as much as what they would need to retire in Jacksonville.
This is largely because the of the cost of housing. Adam says the median home market value is $350,000 in Boca. With a $150,000 down payment, that leaves James and Ruth with a mortgage of $200,000 $898 a month, or $10,776 a year.
A higher market value also means higher homeowner’s insurance and property taxes . Overall, Ruth and James would spend an estimated $32,376 on housing, or almost 45% of their budget.
Because Boca Raton has a higher cost of living, they’ll also need a bigger budget to accommodate miscellaneous expenses, such as groceries and entertainment, which could cost $6,000 and $3,500 a year.
Ruth and James will also have a bigger budget for vacation and travel as well as giving to charity or family. According to Adam, providing support or assistance for children or grandchildren is becoming more common, so Ruth and James also have a bigger budget for gifts and charity .
Read Also: Retiring In Santa Fe New Mexico
Hurricane Insurance Premiums Are A Menace Too
Retirees who move to Florida are often shocked to discover that deductibles for hurricane insurance often range from 2% to 5% of the policy coverage, rather than the fixed dollar amount, say $500, they were accustomed to up north. And thats if you can line up any insurance at all.
Homeowners insurance in general can be tough to get when you live on a barrier island, says Elliott, the northern transplant who now lives in Fort Myers Beach on the Gulf Coast. No one wanted to insure us, so we had to use the default state insurer.
If you want to spend less on insurance, youll have to dish out for a wind mitigation test for the house you plan to buy to see how well it would stand up to severe winds. Why? The cost to insure a home without wind mitigation features could be four times higher than a home with wind mitigation, says Chris Heidrick, an independent insurance agent in Sanibel, Fla.
Oh, and if you buy a home in a designated flood zone, your mortgage company will insist you buy flood insurance. Typical homeowners insurance covers wind and rain, but not flooding.
Tips To Adequately Prepare For Retirement
- When most people think of retirement, they imagine a time that involves relaxing and enjoying their family. But to be sure thats what youre doing, you not only need to save for retirement. You also need to grow your savings through investing. Unfortunately, the interest you can earn from a bank account or certificate of deposit probably isnt going to be enough.
- Dont go it alone. A financial advisor can advise you on investing and manage your portfolio. To find the right one for you, use SmartAssets pro matching tool. It is free, takes five minutes and will connect you with up to three advisors based on your preferences.
Don’t Miss: Tricare Dental Program For Retirees Ending
Florida Has An Excess Of Weirdness
Perhaps Florida gets a bad rap, but come on: It sure has more than its fair share of weird stories that waft in and out of the news cycle. Craig Pittman, a native Floridian and journalist at the Tampa Bay Times, literally wrote the book on Florida weirdness: Oh Florida! How Americas Weirdest State Influences the Rest of the Country. Heres a telling snippet from a 2016 New York Times review of Pittmans book: The deal with Florida is the charlatans and lunatics and Snapchat-famous plastic surgeons. It is the Ponzi schemes, the byzantine corruption, the evangelical fervor and the consenting-adult depravity. It is the seasonless climate. The lack of historical consciousness. The way in which this nations unctuous elements tend to trickle down as if Florida were the grease trap under Americas George Foreman grill.
Floridas Tourists Can Slow You Down
Ever since you were a munchkin, you knew Florida as a tourist destination. If you visited Walt Disney World when you were a kid , you marveled at the crowds. As a resident, youll probably only be annoyed by them.
Approximately 87 million tourists visited Florida in 2020, according to Visit Florida, the lowest number since 2010. But that was during the pandemic, when tourism was down everywhere. In 2019, Florida had 131.42 million tourists, and the state has had more than 100 million visitors a year from 2010 to 2019 converging on the states famous theme parks, beaches and destination spots such as the Keys and Everglades National Park.
The high season, when the snowbirds, holiday travelers and spring-breakers all converge on Florida, lasts roughly from mid December to mid April. Theres also summer season, lasting from mid June to mid August, when the kids are out of school and summer vacationers hit Florida. That makes for a lot of people on the road, an annoyance to the locals when they need to run errands.
Don’t Miss: Empower Retirement Transfer To Fidelity
The Consumer Price Index Surged By 7% In December Of 2021 The Fastest Rate In Four Decades Surging Inflation Is A Troubling Developmen
2022-02-10
The consumer price index surged by 7% in December of 2021, the fastest rate in four decades. Surging inflation is a troubling development for the millions of American retirees relying on fixed incomes and those whose savings are invested in equities markets and it should serve as a wake-up call for the one in every four American adults with no retirement savings.
