After almost two years, the pandemic has brought major life changes clouding the path to a stable retirement for many individuals. Americans are struggling with key decisions on investments and estate planning strategies, according to a recent Hearts & Wallets report, while the National Institute for Retirement Security says more than half of Millennials and Gen Xers are more worried about their retirement security than before COVID hit.
Add in significant changes in the employment market, with women being disproportionally affected than men and unprecedented numbers of workers taking part in the “great resignation” along with continued market volatility, and it’s no wonder retirement security feels unattainable for many.
But there is hope. Making some smart money moves right now can get you on solid footing for your retirement. Don’t know where to start? Professional advice — whether from a local financial professional or one offered through your workplace, a phone-based or virtual financial professional, or even digital advice tools — can help.
Where to start depends on your personal goals and how the pandemic may have impacted your progress. Here’s what to consider:
If you quit your job as part of the ‘Great Resignation’ …
… You’ll need to make sure the career change doesn’t derail your retirement plan. Think twice before cashing out of your previous workplace retirement plan, which can cost you big in taxes and penalties. Once you’ve landed in your next role, opt into the workplace retirement plan as soon as you’re eligible, contributing at least enough to get an employer match — more if you can. And carefully consider the options for your old 401(k) or similar savings plan.
If your new plan provides access to professional advice, take advantage of it. Or consider speaking to someone outside of the workplace who can provide you advice based on your entire situation.
If you put off milestones, such as buying a house or getting married during the pandemic …
… It’s time to get back on track, but be careful not to overspend to make up for lost time. A financial professional can help look at your current financial picture to create a financial strategy that will help you reach both your short- and long-term goals, or readjust them, as needed.
For newlywed (or soon-to-be-married) couples, a financial professional can serve as a third party to help you set financial goals and navigate the sometimes-tricky waters of combining — or not combining — your finances as you begin building a life together and planning for the future. Financial professionals can also help you make sure you’re adequately protecting yourself from a variety of risks.