Retirement is a milestone many people plan for and look forward to. And if you're aiming to retire in 2034, you're just 10 years away from wrapping up your career for good. How exciting!
If you want your plans to come to life, though, it's important to be on track to end your workforce stint in 10 years. With that in mind, make sure to tackle these essential moves in 2024.
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1. Assess your savings
It's easy enough to log into your 401(k) or IRA and see how much money you've accumulated to date. But if you're hoping to retire in 10 years, don't just look at what you have at present. Instead, figure out how much more money you have the potential to accumulate, based on additional savings opportunities. Also, try to determine what annual income your savings will lead to.
Let's say you're sitting on $800,000 right now and have reason to believe you'll be at $1 million by the time you're ready to end your career. What percentage of your nest egg will you feel comfortable withdrawing per year?
If it's 4%, that leaves you with an annual income of $40,000 from savings. If it's 5%, you're looking at $50,000. It's important to know what income to anticipate to make sure your expenses will be manageable.
2. Check up on your investments
If you're still a good 10 years away from retirement, you don't want to rush to dump all of your stocks, as that might stunt your portfolio's growth. At the same time, though, you may want to start thinking about shifting over to investments that are more stable, like bonds, in the coming years.
Not only is it a good idea to review your investments about 10 years ahead of retirement, but also to determine your risk profile. If seeing your portfolio value decline in a year or two is something that will wreak havoc on your mental health because you're so close to retirement, then you may want to start moving your money into safer investments.
3. Get an estimate of your Social Security benefit
There's a good chance that Social Security will play a big role in your retirement finances. So it's a good idea to get a sense of what monthly benefit you might be looking at.
Your monthly benefit will be calculated based on your 35 highest-paid years of wages. If you're not planning to retire for another 10 years, the estimated benefit you're given today may not be the benefit you'll end up with. But you can still get a pretty good sense of what that number may look like.
From that point, you can strategize. If you're not so happy with your estimated benefit at full retirement age, for example, you can try to factor a delayed claim into your plans, which could result in a boosted monthly benefit for life.
Being 10 years away from retirement means it's time to start crunching some numbers and assessing your overall financial picture. Make these moves in the coming year, and you'll be able to begin your retirement countdown with a lot more confidence.
