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Beyond Retirement: Consider Your Other Goals

Retirement savings isn’t the only financial goal you should consider in your lifetime. There are other milestones that you ought to take into account as well.
When it comes to financial stability, people tend to focus on paying off debt and saving for retirement. In reality, many other financial goals beckon to individuals during their lifetime. Because of this, it’s important to look beyond retirement when setting targets, no matter how old you are.
Identify Future Objectives
While it is never too early to start planning for retirement, waiting until you reach 65 years or older to truly live is a mistake many people come to regret. A number of exciting possibilities are waiting for you throughout your life:
  • Building an emergency fund
  • Creating and growing passive income
  • Starting a business
  • Owning a home
  • Becoming debt-free
  • Raising a family
Consider Income
While some people start their careers making six figures or more, this is rare. The median salary for those 20-24 years old is $706 per week—or $36,712 per year, according to the Bureau of Labor Statistics. Those in the 25-34 age range have a median salary of $52,156 per year. If your salary increases follow the historical rate and you have no major employment gaps, you should earn close to $2 million by the time you’re ready for retirement.
Without a doubt, $2 million is a lot of money. If you take a second look at the list of potential financial goals, however, it begins to lose its comparative value. For instance, the median current cost of a starter home in 2022 was $325,000—a 48% increase over the cost of the same house in 2019. Similarly, student loans are one of the biggest obstacles to a debt-free life. The average student loan debt is $37,787, and nearly 43 million borrowers have federal student loan debt.
Create a Plan
If you’re starting to feel discouraged, the good news is that money isn’t a static asset. It has the potential to grow and do some of the work for you by creating passive income. In fact, people who begin to invest in their future early can better position themselves in the pursuit of their retirement goals. You can employ several different strategies to help your money go further:
  • Designate a portion of raises: Instead of increasing living expenses to match any pay increases, try to retain the original budget as much as possible and invest the extra. Keep the same starter home you bought. Drive your current car for as long as possible.
  • Start small: Not everyone is making more than $35,000 per year at age 25. Some people make significantly less throughout their earning years. The answer to this economic problem is to start small. Save $100 per month if you can and $10 per month if you can’t. It all adds up, especially when properly invested. In 10 years, $100 per month at a 6% annual return could potentially grow into $15,996. (This is a hypothetical example and is not representative of any specific situation. Your results will vary. The hypothetical rates of return used do not reflect the deduction of fees and charges inherent to investing.)
  • Buy wisely: When you purchase a vehicle or buy a home, consider the maintenance cost and tax breaks. For instance, is it better to invest in solar panels than a new sunroom for your home? Likewise, consider the potential tax or economic benefits of a small electric vehicle or hybrid over a new mid-size SUV.
  • Make use of programs and incentives: There are many financial products and accounts available that could help you invest your money in a tax-efficient manner. These include HSA accounts, 401(k)s, Individual Retirement Accounts (IRAs) and 529 college savings plans. Taxes can have a big impact on passive income. It is important to manage their impact over a lifetime.
Reduce Debt
The best time to start minimizing debt is before you take any on. This does not mean you should never buy anything on credit. It does imply wisdom in how you use debt. Also, be wise about payment terms, interest rates and the types of debt.
Whenever possible, pay down that debt as quickly as you can. However, never become so focused on paying off debt that you neglect your savings. Take yet another look at the list of potential financial goals. There is more to life than repaying big corporations.
Need help figuring out where to get started? Our financial professionals at LPL Financial can help. Contact us Fibre Financial Group for more information today.

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. This material was prepared by LPL Financial, LLC.

Member FINRA/SIPC
MC-1365950ART19-1222
Tracking # 1-05358070

 

Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Fibre Federal Credit Union and Fibre Financial Group are not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Fibre Financial Group and may also be employees of Fibre Federal Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Fibre Federal Credit Union or Fibre Financial Group. Securities and insurance offered through LPL or its affiliates are:

Not insured by NCUA or Any
Other Government Agency		 Not Credit Union
Guaranteed		 Not Credit Union
Deposits or Obligations		 May Lose Value

 

The LPL Financial registered representatives associated with this website may discuss and/or transact business only with residents of the
states in which they are properly registered or licensed. No offers may be made or accepted from any resident of any other state.

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