Karla plans to retire at age 68, and estimates that $39,600 a year in retirement for 23 years will be needed. That annual amount will be paid out in monthly income checks. To save for retirement, Karla plans to put money every month into a 401k plan at work. If Karla is currently 29, how much will need to be saved each month to meet the retirement goal, assuming the retirement accounts earn an average of 5.6% per year.

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Retirement Income

Retirement income is the income received by the retiring person after retirement. Income can either be paid every month or paid annually. The retiree would get a guaranteed income until their death. Retirement income payment differs from person to person based on their investment type and payment method. Some are paid on a lump-sum basis and some are paid in a regular series with fixed payment or variable cash flow. Retirement income can be created from retirement savings, investment, salary, bonus, and wages from employment. Every working individual should plan their retirement income according to their income goals for the future. The plan should be made by identifying suitable income sources, estimating future expenses, applying a savings plan, and managing risk and assets. The most common age for retirement is between 60-65 years.