1. Age to Retire:
The perception for engineering people has never been passive, but they have to face same difficulties as other professionals face on their retirement. Most of the people are in doubt that they have enough money to life conformably after their retirement. The chances that retirees will get social security benefits are lower, when they need these benefits most. According to a survey like other groups of professionals, engineers also say that they are planning to retire at the age of 66. Therefore, considering all the difficulties that can be the part of after retirement life, it has been decided that I will continue working until the age of 66 (McSherry).
2. Estimate for the Amount required for Retirement:
Estimating the retirement amount is not an easy task as it includes several things of which the major one is inflation. Therefore, the amount that will be required at the age of retirement has been calculated with the help of a preretirement calculator. It has been estimated that the inflation will increase by 3 percent and with the average annual salary of $63508 the amount that will be required is $1833768. For providing the inflation adjusted retirement income, I will need to save 17.3 percent of yearly income. If I start saving from the first year of my job, then I will have to save $913 per month. However, the more the saving will be delayed the more will have to save for reaching the desired retirement income (Calcxml).
3. Accumulation of assets to help fund the Retirement:
Assets accumulation refers to the increase in the value of the financial investment and financial property over time by the process of earning returns and saving money. The major goal of all investors and savers is the building of assets; it represents the increment in the savings, net worth, and the value of the portfolio. Asset accumulation is amongst the powerful ways to save money for retirement. Before retirement, people can accumulate funds with the aim of using at their retirement age. Assets accumulation can be done through lending money to others. The amount will be invested in stocks, and the money will be lent so the earned interest can be used to fund the retirement.
4. Anticipated Starting Salary based on Current Major (Industrial Engineering):
Improving and managing production processes is a primary task of industrial engineers. The major concerns of these professionals are to better utilize the human assets and other resources that benefit the firm. Industrial engineers are liable to implement better production and labor processes, determine quality and reliability, and effective production standards. Due to the effectiveness of the profession, engineering is a well-paid profession and will continue to be a well-paid line of work. The anticipated starting salary of the profession is $ 50000 at least because in the same profession people are making up to $ 90575 per annum. However, according to the estimates, the average salary of an industrial engineer is $63508 per annum (Pay Scale).
5. Investments to Provide Retirement Income?
After having an analysis of different articles and visiting diverse sources, I found that depending on myself is a better option to fund the retirement. Therefore, it will be made sure that as much money as I can save I do and secure my future. Although all financial products that are offered are good, but in order to ensure good after retirement life and provide retirement income, I intend to rely on or invest in 401k plans and personal saving accounts. Personal savings are amongst the best ways to ensure the retirement income (McSherry).
6. Some Of the Risks or Challenges That Current or Future Retirees Face:
It has been estimated that in next 20 years approximately 79 million of American will reach the age of retirement and will join million of people who already have been retired. The most common risks or problems that retirees have to face include the outliving of the assets, risk of inflation, risks of poor returns if retirees invest in bonds, CDs, healthcare expenses, and taxes. In the cases where people decide to retire at the age of 59 may have to face the risk that their age exceeds the assets requirement in such case they have to face difficulties. Inflation is the rise in the cost of goods and has a significant impact on the retirement income as people for fulfilling their needs will require more money that will pessimistically affect the life of retirees as they will be left with less income for healthy living. When planning the retirement, it is also essential that a proper healthcare plan is considered. Increased healthcare expenses can cause to enhance the retirement amount far more than as estimated (Helms).
7. Impact Of Social Security & Medicare On Future Generations And Challenges For These And Other Retirement Plans:
Medicare for approximately 45 million Americans is a valuable health source. The program will have a significant positive impact on future generations as all retirees will be insured. However, some issues are associated with the programs. The first issue is that how the future generations care will be financed without taxpayers, the general economy, and beneficiaries. The second issue is the role of private planes in Medicare. The concerns regarding current payment system are increasing, as the enrolments are increasing rapidly and offering services to wider enrolled people is a challenge. To make the availability of health care affordable is a challenge. Social Security & Medicare account 40 percent of the federal budget (Kaiser Family Foundation). All other the retirement plans may also face same challenges of providing good healthcare to its individuals.
8. Influence of Inflation Influence on Retirement Income:
Inflation is a mandatory aspect of any retirement plan. People after having retirement can expect to live longer. Once people are retired, they have to live on a fixed income, which means no more bonuses, the rise in income, or any other contribution to a retirement plan. Inflation is nothing more than a rise in the prices of goods and decreases the worth of the dollar. Therefore, when planning the retirement income, it is essential to consider the inflation. According to the investments of Fidelity, the average 401k balance for the workers with more than 55 years who are active for 120 years the balance is $269500. Nevertheless, in 30 years, the balance will top $3 million while all things remain equal. To overcome the impact of inflation, investments will go up, and if people deny contributing more, it will negatively affect the retirement income (Sightings).
9. Steps for Protection in Retirement:
Several ways can be adapted to protect the self from retirement. For example, people can invest in securities with the aim of having adequate returns. It is essential to keep yourself debt free, as it will save to give any amount to others as interest. The best way to keep the self-safe from retirement is to “do not do nothing”. Having financial freedom does not mean to avoid working; I will search for good part time opportunity to keep myself busy.
Works Cited
Calcxml. How much will I need to save for retirement?. Online. 27 Jun. 2016. https://www.calcxml.com/calculators/retirement-calculator?skn=#results
Helms, Jeff. The Five Key Risks All Retirees Face. Age In Place Networks. Online. 27 Jun. 2016. http://ageinplace.com/senior-retirement/the-five-key-risks-all-retirees-face/
Kaiser Family Foundation. Medicare Now and in the Future. Kaiser Family Foundation. 2008. Online. 27 Jun. 2016. http://kff.org/health-reform/issue-brief/medicare-now-and-in-the-future/
McSherry, Jay. Salary Survey 2011: The Retiring Engineer. Penton. 2013. Online. 27 Jun. 2016. http://electronicdesign.com/trends-amp-analysis/salary-survey-2011-retiring-engineer
Pay Scale. Industrial Engineer Salary. 2016. Online. 27 Jun. 2016. http://www.payscale.com/research/US/Job=Industrial_Engineer/Salary
Sightings, Tom. How Inflation Affects Your Financial Future. 2013. Online. 27 Jun. 2016. http://money.usnews.com/money/blogs/on-retirement/2013/11/26/how-inflation-affects-your-financial-future
