Middle Class Saving For Retirement

The Middle Class will be in trouble in the near future if it doesn't start thinking about retirement.  Currently, the Middle Class has less than 7% of what it will take to retire comfortably.  Meaning, the Middle Class retirement income will be operating at a deficit.

The experts predict that the Middle Class will need at least $300,000 to fund their retirement -- and that amount depends on your style of living.  However, the current middle class only have allotted $20,000, which is the 7% referenced above. Your retirement salary should be slightly more than your current salary.

The largest group within the middle class are: those that are aged 30 to 69 making $40,000 up to $100,000 a year.

Many in the middle class have already decided that retirement will include some type of supplemental income -- like a part-time job.  However, if you're saving for retirement properly you can avoid going broke during retirement. 

For now, Social Security should be counted as one of the ways you will be financing your retirement. But Social Security only goes so far. Below is a list of other ways to ensure a retirement salary, aka retirement income.

• Immediate Fixed Annuity
• Regular Withdrawal Plan
• Bonds
• Dividends
• Home Equity

An Immediate Fixed Annuity - Immediate fixed annuities are sold by insurance companies, and are contracts with a guaranteed payout for a given amount of time.  Your principal investment is not return because it is payout over the duration of the annuity you selected.

Regular Withdrawal Plan - If you have some cash, you could set a plan in place to make regular withdrawals.  This option requires that your money is in an interest earning count.

Bonds - Bonds are debt from others.  The safest bonds are those issued by the government and other financial institutions.  If you can purchase enough bonds -- you could live off the interest.

Dividends - Dividends are payments payout from a stock you own.  Not all stocks pay dividends, and dividend payout can be stopped if the company runs into trouble.  Therefore, dividends are less safe than other investments.  If dividends are part of your retirement plan, you should limit your exposure.

Home Equity - If you have some equity in your home then this make be a good opportunity to pull out some cash.  You have two options in access your home equity.  One option is to sell the home -- downsized to another residence.  The second option is to refinance.