How is your retirement planning going? Do you have a plan? Think of retirement as a three legged stool. In order to maintain balance, you need all three legs…or there is a real possibility of a crash!
One leg consists of the benefits your government offers you. Make sure you are aware of what is planned for those benefits. Any change in future promises should be accounted for when funding the third leg.
The second leg is your company’s pension plan, either a defined benefit (you work so many years and the company provides you with so much monthly benefit) or defined contribution (such as 401K plans). Learn how your plan works; read the plan description; stay on top of the news coming from the company. On the 401K side, become a good investor. Teach yourself the fundamentals of good diversification and know how much you have and when you will need it.
Finally, the third leg, and the one that you can exercise the most control over. The saving you do yourself. Everyone – everyone – needs this third leg. It consists of the money you yourself set aside on a disciplined basis to help in retirement. You don’t directly control government benefits and you don’t directly manage your company’s pension plan. But you do manage your own life.
Click here to learn about how the Knights of Columbus can help you with this third leg.