Tag: retirement income strategies
What Retirement Income Puts You In The Top 1%
user 0 Comments Retire Wealthy Tips for Retiree's
what income does it take to be in the top one percent of all retirees you'd think that'd be a relatively simple project to research turns out it wasn't so stick around and benefit from the work that I did to uncover these hard to find numbers let's go for a walk and talk about it and you know the first thing I want to observe is that most of us probably would not recognize could not tell by the lifestyle folks that are in the top 10 percent of all retiree income when I get to the numbers I I think you'll you'll say okay I think I would be able to recognize people that are in the top one percent I'll give you a hint it's a it's a much bigger number than than I thought it was going to be okay and and so why is that you know why wouldn't we recognize uh the folks that are in the top 10 percent and it's because like a lot of things in life you know if you look at Millionaires and millionaires lifestyle you know 70 of millionaires in America are self-made made and and most of them most of us uh got there by being you know uh careful with our money and and and being good Savers is as much as uh being fortunate and and receiving a good salary along the way okay so I'm going to start off with what these numbers look like for all Americans and this is from a large data set they say it's the largest population data set uh in the world and the organization is called ipums and this is for all Americans not just retirees so to be in the top well first let's start off with median and and this is household this is household income the median household income uh in the United States for for everybody all ages is is seventy thousand dollars to be in the top 25 you've got to make about a hundred and thirty thousand dollars to be in the top 10 you're making a little over two hundred thousand dollars that the household income a little over two hundred thousand it's two hundred and twelve thousand and to be in the top one percent you're making over five hundred thousand dollars a year now um and the number is five hundred and seventy thousand what was interesting is each of those groups from um 2021 to 2022 so this is a data set uh that they released the results of at the end of 2022.
each of those groups got a raise between 2021 and 2022. unfortunately from the median and Below on an inflation adjusted basis folks that are at the median below uh are actually making less on an inflation-adjusted basis folks that are above the median are making more in 2022 and we've heard this play out in the press okay so so those are the income levels now let's talk about savings and there's a really interesting point I wanna I wanna share with you here okay to be in the um to be in the top one percent of Savers in the United States this is the top one percent if you're between 65 and 69 75 and 79 or over 80.
it's to be in the top one percent you've got to have 2.7 million dollars in what's called net worth and net worth is just take all of your assets all of your savings accounts the value if you own a house the value of your house and subtract from it the the the debt that you have on that essentially so you just take all of your assets and you subtract all your liabilities your car alone your your mortgage your credit card debt hopefully you don't have too many of the latter two uh and that's your net worth so uh if you have a net worth of 2.7 million dollars a household net worth uh in the United States you're in the top one percent what I want to point out is you know if you look at the income boy that income is really staggering right I mean the top one percent of income is 570 000 or higher and you know some people will say well you know that number seemed a little low I was expecting that top one percent income to be higher and I I agree but that's like the last person that made it into the top one percent so there's plenty of people in that category that are making a lot more money but think about this you know the the lowest income in the top one percent is almost six hundred thousand dollars right it's five hundred and seventy thousand dollars yet to be the top one percent in savings you just need two point seven million dollars or more um and what that tells me is you know as a society as a country it's no surprise we're not saving enough money and so um it's not enough to make a great salary you've got to be able to to save it but to me that was just staggering that you know essentially that top one percent you know if they were the Savers they essentially have saved um what five years worth of income uh and most of us could not retire if we had just saved five years worth of income right so that just shows just the the importance of living below your means and and saving as much as you can okay let's keep going now I'm going to break it out by decile and again this is household this is according to the Congressional research service so the the lower quintile so there's five groups the lower one-fifth the lower 20 percent of Americans are making under twenty two thousand dollars a year then the next group up from that are making you know between that twenty two thousand and forty thousand the next group up to that is is making between forty thousand and sixty five thousand um so you can see that you know eighty percent of Americans households are making less than sixty five thousand dollars a year now I haven't got to retirement that's coming up here really soon um let me get to the top quintile the top quintile households in America are a little over a hundred and ten thousand dollars let's call it a hundred and eleven thousand dollars okay so now let's get to what I finally was able to find out so I've shared a lot of info information here and I think many of you are listening to this this uh these numbers and saying you know what I'm doing okay you know it's hard to get that high high salary but if you're saving and if if you're uh spending less than you earn if you're saving that and then importantly if you're investing that remember it's not enough to just save you have to invest it you have to get compounding working for you so a lot of you I think are looking at the at least the savings number and saying yeah we're doing okay we're doing okay and I hope you are I hope you are okay so now getting on to the uh uh the the top income in retirement uh and before I get there if you're enjoying this video take a quick second and hit the like button it really does help the algorithm uh find other people that this this video uh and my videos can help okay so um I'm gonna break this out the top 10 percent the top five percent and the top one percent so people 65 to 69.
Now this is people that are working and not working top ten percent is two hundred thousand top five percent is two hundred and sixty thousand top one percent is essentially one million dollars okay so that's 65 to 69 and now for people 70 to 74 numbers come down a little bit top 10 percent is a hundred and seventy thousand dollars top five percent uh is 260. is that right yeah 265 000 and and the last number is a million dollars so retirees to be in the top one percent of all people 65 and older you need to be making a million dollars a year just to put that in perspective that rule of 25. if that's what the uh if that's what the income is then they had they'd have to have 25 million dollars in savings by the the rule of four percent I hope you found this video helpful if you did I know you're going to like this video up here that talks about average income for retirees in America in this video down here that talks about five reasons to retire as soon as you can thanks for watching bye bye
Read MoreFactors That Can Reduce Retirement Income
user 0 Comments Retirement Planning
There are many different factors that can reduce retirement income. The first may be fairly obvious, but it’s the effect of death. For two spouses when there’s a pension involved, the death of a spouse could mean the loss of a pension income. Now if there’s a survivor benefit, that income may continue, so it’s important to evaluate your options when making pension decisions. A lot of people use insurance to protect against this type of income loss. Another way death can reduce retirement income has to do with Social Security. When two spouses are receiving Social Security and one spouse passes there will be a loss of one of the benefits. Now, the surviving spouse will receive the higher of the two benefits, but there still will be some loss of income. The final way that death can reduce retirement income has to do with taxes. Moving from married filing jointly to now filing single can push the survivor into a higher income tax brackets. The reason for this is that the income thresholds for married filers is about twice what it is for single filers. This can have a major impact on the surviving spouse’s net after tax income in retirement.
Taxes in general is another area that a lot of people overlook when it comes to retirement income. The reality is that taxes will take much more from you than the market ever can. For instance, going back to 2008 during the Great Recession, the average portfolio might have declined 20 to 30 percent, assuming it was well diversified, of course. That might have taken a couple of years to recover, but taxes in retirement can easily cost anywhere from 30 to 40 percent. And that’s money that will never come back. So it’s really important to consider where your different sources of income are coming from in retirement. Would it all come from pensions, Social Security, IRAs, 401(k)s, sources that will be taxed at ordinary income rates? Or do you have good tax diversification where you can choose from pulling money from maybe a Roth IRA raise or non-qualified accounts and really get a lot of control over your taxes in retirement? And finally, inflation. Inflation is absolutely something that can reduce your income in retirement. And it does this by reducing the purchasing power of your dollar in retirement.
Inflation isn’t just something that happened in the past – things will continue to cost more in the future. So let’s look back 30 years. 30 years is about the average timeframe for most people in retirement. So in 1989, the average cost of a first class postage stamp was twenty five cents. Today that same stamp will cost you fifty five cents. Also in 1989 the average cost of a new car was $15,000. Today the price of a new car will set you back on average $37,000. So you need to look at how well your different sources of income will keep up with inflation during retirement. For help optimizing your retirement income, visit us at PureFinancial.com. .
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Read MoreRETIREMENT PLANNING TIPS FOR AGE 59+
user 0 Comments Retire Wealthy Tips for Retiree's
Are you intending for retired life as well as you'' re just not certain of the following step. For example, allow ' s say by the time you obtain to retirement, you ' ve gathered a million dollars. What ' s the larger problem?
Now it'' s your turn. Allow'' s dive in. Currently, what you do not desire to do right here is to think about what your wage is presently, while you'' re working. For example, allow ' s say by the time you obtain to retirement, you ' ve gathered a million dollars. Tip number 7, don ' t overly worry regarding the question, do I have enough to retire?
What Retirement Income Puts You In The Top 1%
user 0 Comments Retire Wealthy Tips for Retiree's
Now this is individuals that are functioning as well as not functioning leading ten percent is 2 hundred thousand top five percent is two hundred and sixty thousand top one percent is basically one million dollars fine so that'' s 65 to 69 and currently for individuals 70 to 74 numbers come down a little bit leading 10 percent is a hundred as well as seventy thousand dollars top five percent uh is 260.
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