Be Financially Prepared for Retirement

We all want to retire eventually, but being retired is not devoid of financial worries and concerns. Retirement requires planning like reading these retirement tips and saving to set yourself for the future. What’s alarming is that roughly 66% of Americans worry about if they will ever be able to save up enough money to fund their retirement.

Unfortunately, too many people push off saving for their retirement life event until it is too late. The good thing is, even if you are already in your 50’s and still work full-time, saving for your retirement for the next 15 years will make a significant difference. Here are some of the things you can do today to make sure you are prepared for a comfortable retirement in the future.

Don’t rely on your pension

Your company may offer you a pension when you retire, but it’s very important to weigh your options before selecting an option. Most pensions offer a single pay option and a joint pay option. With a single pay option, the pension earner will receive a payment each month until they pass away. The joint pay option offered a reduced payout until the pension earner and their spouse pass away.

If you are in poor health and you’re married, a survivor benefit plan vs an insurance plan is probably the best option. However, if you’re in average or better health, buying a permanent life insurance can save you thousands of dollars each year while still providing your spouse with an income that is equal to or greater than what your pension can offer.

If you’re nearing retirement age, it’s important to note that some life insurance companies can take 6 to 8 weeks to approve an application. For this reason, it’s best to apply for life insurance at least 3 to 6 months before you decide to retire. You want to give yourself plenty of time to weigh your options and make an informed decision.

Furthermore, once you have retired there are also various later-life finance options that may be available if you need to take out a loan. Equity release is just one of these routes retired people take in order to free up some extra money.

Start paying off outstanding debt

If you are nearing retirement age and have debt, your primary goal should be to eliminate it before you stop working. Any debt is a financial burden you need to relieve yourself of if you truly want to get the most from your retirement. Start reducing your credit card spending now while you are still earning a comfortable income and try to reduce your other outstanding bills.

Start saving money

According to studies, 31% of working adults haven’t even started saving for their retirement yet. If you are part of this statistic, it is time to readjust your finances to start saving more and spending less. By age 45, every employed individual should have at least some money set aside for retiring, especially if you hope to retire in your 60’s.

Create a strict budget plan

To build a budget for your retirement, you need to consider all your expenses for an entire year, not just for a month. This will help you to better plan for unexpected bills and expenses that might come up. Retired people usually spend most of their money on housing (check out assisted living lincoln ne), transportation, and healthcare. By allotting the right amount for each expenditure, you can better plan how much you should have by the time you retire.

In conclusion, it’s never too soon to start saving for your retirement, especially if you are working full-time. If your employer offers a 401(k) or an IRA, you should take advantage of it, especially if they are offering you any type of match. If you are lucky enough to receive a pension when you retire, consider maximizing it with life insurance instead of accepting a joint payout; it could save you thousands of dollars a year, especially if you’re in average or better health.

A lot of retired people struggle to live comfortably because they lacked adequate financial planning. Don’t suffer the same fate, start planning and saving for a comfortable retirement now. Setting aside some money each month will add up over the years, and in the long run, you’ll be happy you started when you did.

Thanks to Cliff Pendell

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