27% of Americans are likely to retire, retired

Saving for retirement is one of the most ambitious financial goals you have to achieve. It becomes even more difficult as retirement costs more and more. The average American expects retirement to cost about $ 1.7 million, according to a survey by Charles Schwab, and retirement savings to be at the forefront of workers' financial stress.

It's easy to understand why so many workers are stressed by retirement – the median amount saved by baby boomers for their golden years is $ 152,000, reveals a report from the Transamerica Center for Retirement Studies. According to the Bureau of Labor Statistics, the average American aged 65 and over spends nearly $ 46,000 a year on average, but this money will only last about three years in retirement.

But what is even more worrying is that too many workers do not even think about their retirement goals. And new research shows that a significant number of Americans are putting their retirement at risk.

Many workers do not set retirement goals

Preparing for retirement is not easy, but it's even harder when you do not have a goal. According to a MagnifyMoney survey, about 27% of Americans have no idea how much money they should save for retirement, and this simple mistake can easily destroy your financial future.

If you do not know how long it will take for your retirement, you will not know if your current savings are on the right track. If you reach retirement age and realize that you do not have enough savings, you can not do anything about it. Especially if you need more than a million dollars to last the rest of your life, you will need several decades to save just about the amount you need.

In addition, it may even be easier to back up if you have a goal to achieve. If you blindly deposit money into your retirement fund whenever you want without knowing if you are saving enough, you run the risk of retiring with too little savings. Even if you manage to save a few hundred thousand dollars, this money could only last a few years in retirement.

Of course, when you are in decades, it is not easy to know how much you should save. However, there are many ways to estimate your future costs and get an idea of ​​what you should be saving for when you retire.

How to estimate your retirement number

To determine your retirement number (or the amount you should be saving for your retirement), you must first consider several factors: how much you plan to spend each year, how many years you plan to spend in retirement, and how social security will affect your retirement plan.

The amount you plan to spend each year in retirement is the foundation of your retirement plan. If you underestimate this number, it could come back to you against the animation. Be honest with yourself and try to find as many numbers as you can. For example, if you plan to make a lot of trips during your first years of retirement, make sure to budget for them. And if you have health problems that you think could be expensive as you get older, do not forget about those expenses either.

Then consider how long you plan to retire. The average life expectancy is increasing, with one third of people aged 65 years old expected to live up to 90 years or more, according to the Social Security Administration. On the other hand, if you have health problems or any other reason to believe that you will not spend so many years in retirement, you might not have to save as much. Although you can not predict exactly how long you will live, estimate the best of what you can report – if you live a few more years than planned, it could cost you hundreds of thousands of dollars more than you expected.

Another consideration to consider is the help you will receive from Social Security. Although you can not rely on your benefits for all your retirement expenses, they can help cover some of your bills. According to the Social Security Administration, the average beneficiary receives $ 1,471 per month, although the amount you will receive depends on your income throughout your working years and the age at which you begin to claim benefits. To get an idea of ​​what you will receive, check your social security records. Depending on the amount of your benefits, you will not need to rely as much on your personal savings in retirement.

Once you have all these estimates in mind, pass your information in a retirement calculator. It can also be useful to try multiple calculators, as each uses slightly different algorithms to display your results. Although you may end up with several different answers, it can be helpful to have a range of retirement figures. There is not a single right answer as to how much you should save, but at least you will be in the right stage.

Planning for retirement can be stressful and overwhelming, but you could unwittingly make the task more difficult for yourself by not setting a retirement goal. It can be intimidating to think about how much you need to save, but having a goal in mind is the first step towards the financial success of retirement.