If you are just about to retire, things can seem daunting. This is indeed the case if your job defines you and your previous life. Retirement can be enjoyable, but it will definitely change your life. Get ready to have the time of your life by following the tips below.
Determine the costs you will face after 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. People who already receive a low income may need around 90%.
Cut back on miscellaneous items you often purchase during the week. Jot down your expenses and consider where you can make some cuts. Over several decades, these savings really add up.
Some people choose partial retirement. If you cannot afford to retire fully, consider a partial retirement. This means working part time on your career. This allows you more leisure time while you continue earning money. You can always take full retirement later on.
Exercise is a great way to spend some of your time each day. Your entire body will benefit from regular exercise. Workout at least three times a week to stay in shape.
See if your company offers a savings program. Sign up for the plan which suits your needs the best. Figure out what you can about the plan you choose like how much money it will cost you and how much time you have to stay to get your money.
Consider waiting a few extra years to take advantage of Social Security income if you can afford to. Waiting means your allowance will go up. Working part time or gaining money from other resources makes this more feasible.
Rebalance your entire retirement portfolio once a quarter. If you do it more often than this, you might start reacting emotionally to swings in the markets. If you don’t do it that often, you may lose opportunities. Work with an investment professional to determine the right allocations for your money.
Many dream about retiring and exploring all of the things they did not have time for in their earlier years. However, time often seems to speed by as we age. Make certain that you utilize your time well.
Think about healthcare in the long term. Your health is likely to get worse as the years go on. As you get older, you can expect your medical costs to increase. Using a long-term healthcare plan can help your needs get met at home or at a facility if your health takes a turn for the worst.
Ask your employer about their pension plan. If you find a traditional plan, be sure to research it thoroughly, especially the coverage that it offers. It is important that you understand the ramifications of changing jobs on your plan. You should also learn if you are eligible for any benefits from the previous employer after you leave. Your spouse’s pension program may also offer you eligibility.
Set goals, both for the long and short term. Goals are always important and can help you save money. When you know how much money you will need to live on, you will know how much that you have to save. A little math will provide you with small weekly or monthly saving goals.
If you are 50 or older you can contribute “catch up” money to the IRA account you have. Generally speaking, $5,500 is the maximum that you can put in your IRA each year. Once you’ve reached 50, though, the limit increases to about $17,500. You can start late yet still have lots saved.
When planning for your retirement income needs, plan to live the lifestyle you currently do. Going to work now comes with added expenses, but you can expect your retirement funds need to be about 80% of what you pay for things now. Therefore, you will need to have some extra cash available.
Now that you’ve read this article, you understand a thing or two about retirement. You can now be control of what you do each day. Use the tips above to get you the life that you deserve during your retirement.
For more information on financial planning and retirement visit Virginia Estate and Retirement Planning Advisors, Inc.