Bohemia, NY (PRWEB) November 23, 2013
Chris Hobart, the CEO of Hobart Financial Group, a leading Charlotte retirement planning company, responds to an article published by USA Today on November 12th, which details a few methods people can use to estimate the amount of money they will need to generate to live a comfortable retirement.
According to the USA Today article titled “Pain-free methods to calculate retirement costs,” calculating the amount of money needed to fund retirement can be a very difficult process. However, there are a few methods that can make it easier for workers planning for retirement.
First, the article says the best method is cash flow analysis. Used primarily by financial planners, this method helps individuals and couples prepare for retirement by tallying annual expenses and multiplying that by however many years you are planning to fund. People need to calculate costs relating to housing, health care, food, transportation, emergencies and other types of personal expenses.
The second method is income replacement. The article says research suggests replacing about 85 percent of your pre-retirement income will give you enough money to survive retirement. Retirees typically don’t have to pay as much in federal and state taxes, which means the income replacement method is an easy way to estimate how much individuals and couples should save before retiring.
Individuals can also use a method called minimum needs measure. Through this method, people can use the Elder Economic Security Index (EESI) to compare “national averages for minimum needs for various household types and specific geographic areas.”
Chris Hobart, CEO of Hobart Financial Group, a leading Charlotte retirement planning company, says these are the simplest ways for potential retirees to calculate the amount of money they will need for retirement. “It can be a real chore to determine the amount of money individuals and couples will need to generate sustainable income for retirement,” he says. “While most people need a surplus of $400,000 to live a comfortable retirement, these methods can help people develop a more precise figure of how much they are going to need to accumulate before they retire.”
Hobart agrees that the cash flow analysis is the best option in determining how much money people will need. “During retirement, people want to continue making the same amount they did when they were working in order to sustain their normal lifestyle. By calculating how much money they spend each year on average, potential retirees can multiply this number to find out how much they will need to save if they want to maintain their lifestyle.”
Hobart Financial Group is an independent North Carolina financial advisory firm dedicated to personalizing service with uncompromising integrity. Its focus on comprehensive, tax-advantaged plans help to provide sound preservation of capital, growing income and increased returns with reduced risk. Chris Hobart, founder of Hobart Financial Group, understands that true wealth means being able to share your life with the people you love, free from financial anxiety. Hobart Financial helps Carolinas’ retirees preserve and protect their wealth with comprehensive financial retirement planning and wealth management.