Most people don’t put too much thought into their own retirement. They believe when their working years come to an end, they will easily transition into their retirement. This, however, can be a huge mistake. Prepare yourself to ensure a comfortable retirement. The following paragraphs are here to help you with that.

75 Percent

TIP! Don’t spend so much money on miscellaneous things when you’re going through your week. Keep a list of the things that you must live with.

Know exactly what you’re going to need and what it will cost when you retire. Studies show that the average American requires at least 75 percent of their normal income to survive during retirement: that’s 75 percent of the salary that you are earning right now. Try to save a minimum of 90 percent to be safe.

Most people look forward to their retirement, especially after they have been working for several years. They will think that retiring will be great since they can do activities that they couldn’t when they worked. This can certainly be the case, but it does take hard work to get to this point.

If you can hold off on Social Security, do so. If you wait, you would increase the monthly allowance you are entitled to, which will help keep you financially independent. If you have other income or retirement funds, this is easier to do.

TIP! Think about retiring part-time. If you can’t afford to retire just yet, a partial retirement may be perfect for you.

Rebalance your portfolio on a quarterly basis to reduce risk. Do it too often and you are vulnerable to small market swings. If you don’t do it enough, you aren’t able to put your cash in the best places. Work with a professional investor to figure out the best allocations for the money.

Reduce your expenditures prior to retirement. You want to be prepared for any situation that may occur. Unexpected medical bills or other expenses can be challenging to deal with on a fixed income.

Look into the pension plans offered by your company. Find out if you are covered and how it works. If you intend to change jobs, see what happens to the plan you currently have. Hopefully, you will still be able to access certain benefits. You might also be able to tap into your spouse’s benefits through their pension plan.

TIP! Contribute regularly and maximize the amount you match the employer. The 401k is going to let you put back some pre-tax money and that means you can save a little while not affecting your paycheck too much.

Retirement is a great time to start the little business you have wanted for years. Lots of folks do quite well in their golden years by making their hobbies profitable. This is a pretty low-stress time of your life to do it since you don’t have to worry about how you’re going to pay everyday expenses.

If you’re over 50, try making “catch up” contribution to the IRA. Typically, you can save a maximum of $5500 annually in your IRA. The limit will increase to about $17,500 when you are over 50. If you started saving late, this will help you save more money faster.

When you calculate what you need for retirement, think about living like you already do. You will need approximately 80 percent of your current income to maintain your lifestyle. Just try to avoid spending too much extra cash in this new free time.

TIP! Are you feeling overwhelmed because you haven’t started saving yet? It’s not too late, even now. Look at your finances and come up with an amount that you can put away each month.

Once you retire and are trying to make your money go farther, downsizing is something to consider. Even if your mortgage has been paid off, you still need to worry about expenses for maintenance and things such as your electricity bill. A condo, townhouse or small home are excellent options. You will save more money this way.

Retirement is the perfect time to bond with grandchildren. Perhaps your children will appreciate your assistance. Think about all the things you can do with the grand kids to have fun with them. But think carefully about whether you want to watch them full time, as this can burden your own life, too.

Be certain to have fun. Life comes with its ups and downs, but be sure to live each day as you feel is right. Enjoy your hobbies and make the most of your life.

TIP! Obviously, you need to save quite a bit for retirement, but it’s smart to make savvy investments. Keep a diverse portfolio, making sure that not all of your eggs are in the same basket.

Look into reverse mortgages. This is a loan which is based on your home’s equity, but you can still live there while you have it. You do not need to pay back the money yourself. Your estate will be responsible for this after you pass away. This can provide a good source of extra income if you need it.

Social Security

You will need more than Social Security to support yourself after retirement. While it can help financially, many people find it hard to live on this income alone. Social Security benefits normally provide you with approximately 40 percent of the amount you earned when you were still in the workforce.

TIP! Downsizing when retiring can help you save money that may help you later on. While you may believe that you have a good handle on your financial future, unexpected events often occur.

Look into whether or not a hobby can make you some money. Hobbies such as painting, woodworking, and sewing may be things you’d like to do. During the winter, complete a few interesting products that you can sell at flea markets or otherwise in the spring and summer.

Be sure that you have set up your power of attorney for your finances and for your health care when you retire. These people will make decisions if and when you are unable. This will also help with your bills.

Retirement planning isn’t easy. You need to prepare for it properly to ensure that your retirement years are fun and productive. This article will help you with those preparations. Make good use of this advice.