You plan to hung up your spurs sometime in the future, no doubt. Are you preparing for that day? Here’s a guide to preparing for retirement.
Are you preparing for retirement yet?
Whether you’re well into your career, or just getting started, there’s no wrong time to start planning for your eventual retirement. That said, the sooner you start, the more time you’ll have to get ready.
Saving and planning for retirement can seem like a daunting task, but it doesn’t have to be.
Are you ready to start preparing for your retirement, but aren’t sure where to start? Don’t panic! We’re here to help.
Here’s everything you need to know about how to prepare for retirement.
Figure Out How Much You’ll Need
First things first, how are you planning on spending your retirement?
Say you’re planning on traveling the world before settling into a private villa to enjoy the rest of your golden years. Then, you’re going to need a little more than someone who wants to move into a retirement community near their family.
By figuring out your cost needs ahead of time, you’ll be able to figure out how much you need to start saving and what kind of retirement plan is right for you.
Once you know how much you’ll need for your day-to-day living expenses, there are a few other additional costs you’ll need to take into account.
Keep in mind that your medical expenses will probably rise as you get older. So, you’ll want to make sure you’ll have the resources you need to cover those as well.
Build a Budget
Budgeting is one of the best ways to take control of your financial situation, both now and during your retirement.
When preparing for your retirement, putting together a budget can help you factor your savings into your current costs.
If you aren’t quite sure where to start when putting together your budget, you may want to consider the 50/30/20 rule.
Budgeting can also help you figure out how much you’ll need to put away to retire comfortably.
Start Saving Now
If you’re in your 20s and living paycheck to paycheck, saving for retirement may not seem like a significant priority. But, when it comes to saving and planning for retirement, there’s no such thing as starting too soon.
The good news is, every little bit helps, so don’t be afraid to start small. Just putting 12% of your paycheck into a savings account every month can add up fast.
If your place of work does not have a 401k in place, you should consider looking into an IRA to help you cover expenses once you decide to leave the workforce.
Use Loans to Your Advantage
You can’t expect the unexpected.
If you’re hit by a surprise medical or repair cost, dipping into your retirement can wind up setting you back big time.
Fortunately, there are better ways to cover unexpected costs that won’t throw off your retirement planning.
A pension loan can help you cover surprise bills or expenses, so you don’t get off track. Check out Bonsai Finance for more information.
Preparing for Retirement: Getting Started
Preparing for retirement can seem like a daunting job, especially if your retirement is still a good ways away.
That said, by getting started now, you’ll be able to retire and live out your golden years without having to worry about your financial situation.
Are you looking for more advice on how to start planning for the future? We’ve got you covered!
Check out the rest of our blog for more helpful articles.