A list of must-dos for 40 and 50 year old captains that have run aground
On March 23rd, the massive, skyscraper-sized container ship named the Ever Given ran aground and got stuck in Egypt’s Suez Canal. It took about a week for more than a dozen tugboats, dredgers, engineers, salvage teams, and a full moon that brought an unusually high tide to free the behemoth.
While it’s still not clear exactly how it got stuck in the first place, experts theorize that the Ever Given lost control amidst strong winds and sandstorms. But the Ever Given’s management firm did rule out any mechanical or engine failure. Now some are suggesting that “technical or human errors” may have caused the ship to run aground, costing Egypt about $15 million a day in lost revenues.
The Ever Given, one of the largest container ships in the world, is 400 meters long (that’s over 1,300 feet), weighs 200,000 tonnes (a tonne is heavier than a ton by the way) and has the ability to carry over 20,000 shipping containers (it was carrying 18,300). It’s massive.
Do your aspirational retirement goals feel like the massive Ever Given? And are you a 40 or 50 year old captain that is now stuck? Here is a basic list of must-dos to help unstick your retirement-ship so that you might see smoother sailing.
Unstick Your Thinking
People in their 40s and 50s should really look at maximizing everything they can do to prepare for retirement. This is especially true as our life expectancy grows longer, thanks to improvements in medical science. You should aim to maintain a reasonable retirement lifestyle for two or three decades after you “retire.” And that takes diligent saving and careful planning.
Maximize Your Retirement Contributions
Maximizing your contributions to retirement accounts, such as 401(k)s, is the first step, The annual contribution limit is $19,500. If you reach 50, there is an additional catch-up contribution of $6,500.
If the choice is between saving for retirement and saving for college, give retirement the first priority. There are loans for education, but not for retirement.
Understand Your Spending
Understanding your spending is key to determine when you can retire. Any kind of retirement plan is not going to work if you don’t know how much you spend.
By evaluating your spending, you know how much you need and how much extra money you may have to fund other financial goals in retirement.
Learn About Social Security
Knowing the Social Security rules makes a huge difference, because the age you start claiming it determines your benefit income for the rest of your life.
If you begin collecting Social Security before full retirement age, you permanently reduce your monthly benefit. If you don’t know the rules, you can easily be passing up thousands of dollars of benefits.
Find a Financial Advisor
The key to successful financial planning lies in following wise investment strategies, custom tailored to your personal aspirations. And while your financial plan should be tied to your long–term goals, short–term events (like high winds and sandstorms) need to be addressed too.
A financial advisor can help you keep your emotions out of your investing decisions and keep you from running your retirement-ship aground. That way you can rest comfortably at night knowing that your money is working toward your goals. Not toward hiring tugboats and dredges to dig you out.
At Patriot, we do this each and every day for our clients. If you’re in need of direction and assistance as you approach retirement, or need a second opinion on your current plan or portfolio, reach out to us today.