Lifetime Income Makes For Happy Retirees

Lifetime Income Makes For Happy Retirees

Understandably the happiest retirees on the planet are those that have pensions and can count on a constant stream of income throughout the rest of their lives. Not everyone has this option but if you start early and plan well, it’s not so far fetched.

Many say that money doesn’t buy happiness. Well, it surely won’t hurt you when you decide to retire.

Starting Early

It only makes sense that in order to maintain a steady stream of income, one must start young and take advantage of all retirement plans when they are offered. While many individuals in the younger crowd do not think as much about retirement, it is something that everyone must consider and take the necessary steps to prepare and educate themselves.

Pension Plans

Pensions give you the option of receiving a base monthly income continuously after you retire. Most pension plans are great options that allow you to build up your pension account as you work. Most employers have pension plans that contribute to your balance depending on the amount of work you have done and the length of time at your job.

A downside to pension plans is that sometimes there are stipulations of how old one must be to receive or start building pension benefits. Basically, pension accounts are just like receiving a paycheck each month without the work. How can that not make a retiree happy? Still, in many cases, these types of plans aren’t enough.

401K Plans

401K plans are similar to pension plans in that your balance accrues over a period of time. Most businesses allow you to make the decision regarding how much you would like to contribute to this type of retirement plan from each paycheck and some employers will match what you put into that account or sometimes contribute something to this account as well.

The premise behind this being a hope that you will want to remain with their company until you are able to retire.

In addition to the amounts that workers and employers can contribute to these accounts, a profit sharing aspect can also be added based on a tax preferment basis. A downside to these plans is that many times there are more stipulations to how and when these earnings can be used.

One may be penalized for withdrawing funds prior to reaching the plan’s specified retirement age. In addition, rules and regulations vary depending on the plan and the employer has a little more control over how these funds are distributed.While these are just two of the many options available for retirees, it is safe to assume that these are the most popular answers.

Retirees that have a steady income using one of these two plans in addition to their personal savings accounts find it much easier to remain stable and live comfortably even when the value of money continues to increase.

Even if something legal were to come up, like dealing with a family arbitrator, a retiree would have no worries about the financial portion of the process, if they’ve had a plan in place long enough are are prepared.

For these retirees, it is important that they are able to continue life better or as equal as they did before retiring. After all, they worked hard to earn the money they are receiving and if you plan accordingly, you can find happiness in your retirement as well.

Anum

Anum Yoon is the founder and editor of Current on Currency. She loves all things personal finance, which is why you'll find her work all over the PF blogosphere.

Leave a Reply

Your email address will not be published. Required fields are marked *