Very few folks put a lot of time into retirement planning. They mistakenly believe they have plenty of time to think about it later, or think their employer will handle it. This never turns out well, so avoid this pitfall by reading the content below.
Try to determine what your expenses will be like once you retire. You will need 75 percent of your current income to live comfortably. People who already receive a low income may need around 90%.
Make sure that you are adding to your 401k every paycheck. You can save greater amounts through this because the money is not taxed. If your employer happens to match your contribution, then that is just like them handing you free money.
With all the free time you should have on your hands now that you’re retired, you’ve got no excuse not to get in great shape! You will really need to care for your body in retirement, because it’s important as you age. Make workouts a regular part of retirement and you will be able to enjoy it more.
Consider waiting a few extra years to take advantage of Social Security income if you can afford to. If you wait, you can get more in the monthly allowance they give you, which makes being financially comfortable possible. You can easily do it if you are working or have other sources of income.
Rebalance your retirement portfolio on a quarterly basis. If you do it more than that, you may fall prey to market swings. If you do it less often than quarterly, you are going to miss out on the chance of taking money from growing sectors and reinvesting in areas about to hit their next growth cycle. Work with an investment professional to determine the right allocations for your money.
Downsize when you are approaching retirement. While you may believe that you have a good handle on your financial future, unexpected events often occur. Medical bills and things like big house fix expenses can really hit you hard during your life, and they are really hard to deal with when you retire.
Many people believe there is plenty of time to plan for retirement. Time tends to move faster as you get older. When you plan in advance, you are able to use your time better.
Consider opting into a health plan for the long haul. For many, health declines with age. Poor health can cost a lot in the future. Long term health plans help alleviate the strain of increase costs.
Retirement is a great time to get a small business started if you think it has a chance at success. Many people are successful at turning a favorite hobby into a business that operates out of their home. Since your livelihood won’t depend on the success of the business, you’ll find the situation will not be stressful.
When figuring out how much money you need to live on in retirement, plan on having a similar lifestyle to the one you enjoy prior to retirement. It is probably safe to estimate that your living expenses will be approximately 80 percent of your current expenses since you will not have to pay work-related expenses, such as wardrobe, transportation costs, etc. Make certain that you do not dive into your savings too quickly once you retire.
As retirement looms over you, get your loans paid off first. If you don’t have to pay a mortgage and car payments, your budget will be smaller. By lowering your financial obligations, you can better enjoy your retirement.
Do not rely on Social Security to get you through your retirement years. Although SS payments may cover about 40 percent of the income you’ve been earning over the years, that usually doesn’t come close to the current cost of living. You will need at least 70 percent of your current salary to live comfortably.
If you need to make every dollar go further, downsizing can be wise. Even if you’re not someone with a mortgage, you will still have expenses to pay, like your electricity and landscaping. Think about downsizing to a smaller house. You will save a lot of money this way.
Retirement is a great time to get to spend time with grandkids. Your children may need help occasionally with child care. Become an active participant in family activities. Just don’t agree to watch the kids all the time. You do need time to yourself.
Always make sure you are enjoying yourself. It can be tough to navigate life as you get older, but that’s why you need to stop and make sure that you are doing something every day that speaks to your inner self. Try finding hobbies that you love so that you can enjoy happy days.
Reverse Mortgage
Have you entertained the idea of a reverse mortgage. A reverse mortgage allows you to borrow money based on your home equity so you can continue to live in your house. You do not have to make payments; instead, the loan becomes due on your death. This can provide a good source of extra income if you need it.
Discover all you can about Medicare. If you have existing medical insurance, you must find out how that plan will work in conjunction with Medicare. This knowledge will keep you covered if a medical situation arises.
Retirement can be an enjoyable period of life, but only if it is well planned in advance. Have you done anything to make sure your retirement is comfortable? Your time has been spent well by reviewing this piece, so start applying the advice today.