Are you in your 50s and looking forward to retirement? Then you must be thinking and getting worried about retirement and life after service. Before joining the seniors, you should ask yourself some essential questions that are vital to your overall well being during retirement.
Can my current saving sustain me throughout the entire period?
Have I saved enough to keep me going during my seniors?
Do I need to beef up my saving to guarantee my future?
Can I afford to stop working now if I wish to do so?
Will I be able to enjoy myself after retirement?
How can I correct this situation?
These and many other related questions will likely come to your mind at this stage of your life. Because of questions like these and other fears of unknown, many people are not ready to retire at all while some retire but still work after retirement. However, if you’re not prepared to work after retirement, there are some vital points you must note and take seriously as you approach retirement age.
Now, there is still enough time for you to make necessary changes and be proactive in planning for your retirement. But if you are not having a retirement plan already, it is time for you to have one. This article is meant to help people in this kind of situation, and assist everyone to develop a practicable retirement plan. It will also guide you about investing for your retirement age as well as assist those who require the services of a retirement financial consultant for counsel on planning for their retirement.
What are Retirement Planning and its Benefits?
Retirement planning can be defined as the process of setting up a short and long-term financial goal to help you survive your seniors as expected. This involves both your working and retirement period; assessing your financial goals, current economic status and as well as expected future income to achieve a comfortable retirement. Lack of retirement planning can subject one to the risk of leaving above one’s retirement saving and this will affect your quality of life later in your retirement.
Many at times, lack of retirement plan which may make retiree to go bankrupt may lead to health issues such heart attack, high blood pressure, disability, and even death. Retirement planning aims to assist you in determining your saving plan for retirement, such as investment plan to bring huge returns, how to use post-retirement income judiciously, and to protect your assets. In summary, retirement planning helps you to plan for vital life stages and provide financial security to enjoy your seniors. These life events and needs are not limited to the following:
- Health care services
- Buying a Home
- Job Transition
- Tax planning
- Children’s Marriage
- Post Retirement payout
- Children’s Education
- Retirement Corpus
- Tax planning
However, this first step to a successful retirement guide is to decide earlier enough when you want to retire. This will be discussed next in this article before discussing the guide.
Decide when to Retire
When do you want to retire? Do you want to retire when you are still energetic or when you are in your late 60s, when the need for Medicare kicks in? Or do you want to continue working till you are above 70, when you would have started drawing distributions from other retirement savings? Therefore, the first and most important decision to make is deciding when to retire. This decision must be made now considering the fact that even your office pension plan has a limit as to when you will be able to start making withdrawals. So, make this decision now.
This is because, at your 50s, you must have started saving towards your retirement and if you have started but you are not keeping to your plan, it’s the time for you to reawaken yourself, carry out a review and get back on track. It’s been advised that you should be reviewing your plan at least once in three years.
Therefore, once you had ascertained your financial goals toward retirement and decided how you plan to achieve them, then, follow the pieces of advice listed below during the remaining few years of your pre-retirement period to help you achieve your goals.
Guide to a Successful Retirement
If you plan for retirement very earlier enough, you would gain it in future. Retirement is not something you wake up some years to the time, plan within two to three years and assume everything is alright. The earlier you start the better for you. Consider most of the points raised here as they are applicable to you. With this guide, you would be able to enjoy your retirement to the fullest. Highlighted below are important pieces of advice towards a successful retirement:
1. Learn more on Retirement Planning and Saving
Your chance of achieving your set retirement goals becomes very high when you are fully aware of all the possibilities that are open to you. Therefore, you must endeavor to learn more about the different ways of investing and saving more in smartest ways ever. This can be achieved by reading books on investments, finance magazines, attend classes, and join forum/discussion groups on best ways to invest towards retirement.
Also, familiarize yourself with various rules and procedures of opening and managing a retirement account and what affect your specific age range have on it. Additionally, you can also seek professional advice from retirement planning specialist to help you determine the best option for your case since online resources, classes, discussion groups, and books alone may not be enough to offer the needed suggestions or approaches.
2. Set Realistic Goals
As goal setting is important in the ordinary lives of every individual, so it is when you are planning retirement. However, you must never set a goal that is too bogus and unrealistic. For example, retirement planning professionals have recommended that in order to achieve something meaningful at retirement, your retirement savings must be up to a minimum of 10 times of the total of your last annual income. When setting a goal, you must first consider how much you have saved and what is your level of investment thus far. This will help you to decide on how much more you need to save towards your retirement and will determine the scope of your goal.
3. Appraise your Retirement Plan Regularly
Appraising your finances regularly will likely push you to make more progress towards your saving objectives. Therefore, consider preparing an appropriate retirement plan checklist which you must review and update periodically starting from the priority list at the top to the last on the list. This will help you keep track of your progress towards achieving your goals and push you to make adjustments when necessary.
4. Evaluate what you’ve already saved
At this age of your precious working life, it’s time to know how much precisely you have saved towards your retirement if you’re yet to do that already. You must know the current balance in the savings accounts for your retirement and other savings, investments, likely pension payments, properties and likely Social Insurance payments, and compare them to your targeted retirement savings so you can determine whether you’re on course to achieving your goal. And if you are not on track to meeting your target, then it’s time to adjust in your savings efforts.
5. Always Aim to save more
You must decide and plan to spend less during your retirement rather than spending more than you are already doing now so that you can be able to save more. It’s even advisable to strive towards saving more than what you will need in retirement. To achieve this, you must make specific changes to your lifestyle like reducing your daily expenses as much as possible, review your budget so as to remove or reduce spending on certain things you can live without, etc. Though it may be a little challenging to do away with certain things you enjoy doing, but it will help you to boost your savings and to easily achieve your retirement goal.
6. Seek Professional Advice
As stated earlier, relying your decisions and retirement plans only on the information obtained through reading books, online resources and others alone may not be sufficient enough for your specific situation. Therefore, you may need to seek the guidance and counsels of an expert in retirement issues to help you remain on track towards setting and achieving your goals.
A Research Institute Employees’ Benefits stated in a report of its survey that was carried out in 2018 on Retirement Confidence, those employees who always get advice from financial experts are usually more satisfied about their office retirement plan and/or pension scheme than those who aren’t getting any expert financial advice. It was also discovered during the survey that employees that are receiving expert financial advice are more likely to convert their office retirement savings to an IRA account at retirement. Therefore, hiring an expert financial advisor is a very good and veritable option to embrace.
7. Try to be Debt Free
At 50s, lingering debts can be a burden to you when you stop working especially debt on the mortgage. It’s very uncommon nowadays to see people celebrating being free from mortgage debt for which people used to hold a freedom party before, to celebrate the achievement of a homeowner without a mortgage burden again. However, census data from the Bureau of Financial Protection revealed that over 30% of all homeowners aged 65 years and above still owe mortgage debts. Though, offsetting your mortgage debt as quickly as you can is very good, as it allows you to be free of mortgage burden; thereby allow you to earn more and therefore have more money to invest. But many retirees often find it difficult to retire early thereby keep paying the mortgage on their home.
You must, however, decide whether you want to see your house as a home, or as an investment option. But retiring with a huge mortgage burden is not a good option at all.
8. Be Prepared for Unforeseen Expenditures
Unexpected expenditures like huge medical bills can quickly consume your life savings. So, it’s best to prepare for such in order to safeguard your retirement savings and other finances. According to a 2018 Assessment of Fidelity Investments, an average couple in their early 60s will require approximately $280,000 in order to provide for their health cost when retired adequately. There is also the possibility that you may need comprehensive care at home which may cost about $86,000 for the aged as at 2017 according to available data from Genworth.
Therefore, to safeguard yourself from the resultant effect of all these unexpected costs, you should take advantage of life-long health insurance, which covers extended medical care including nursing home care and aided living. The health insurance must be very affordable at all times throughout the premium period.
The following table displays the best guide to a successful retirement:
|No.||Guide to a Successful Retirement|
|1.||Learn more on Retirement Planning and Saving|
|2.||Set Realistic Goals|
|3.||Appraise your Retirement Plan Regularly|
|4.||Evaluate what you’ve already saved|
|5.||Always Aim to save more|
|6.||Seek Professional Advice|
|7.||Try to be Debt Free|
|8.||Be Prepared for Unforeseen Expenditures|
Whatever you aim to achieve in life, it always starts with making a decision and taking the first step, then the next things can follow. Therefore, it’s very clear from the pieces of advice given above that with adequate planning, setting achievable goals, seek counsels and follow laid down rules and regulations guiding retirement savings and as well as possible investment options available to you will make thing easy for you during your retirement. There is no doubt, with this guide, you will definitely find things and help you achieve your aim of retiring peacefully and enjoying a good life after retirement. Check those points and see if you are missing out on any of them. Stay tuned for more informative posts from this page!