Tips for Planning for Your Retirement
As you get older, it’s a wise move to start thinking about putting some plans together. Not only will you want to see an estate planning firm in case something unfortunate should happen, but you also want to start thinking about your retirement.
Essentially the sooner you start planning for your retirements, the sooner it can happen and the more time you have to achieve your dream of retiring young. Currently, the average age of retirement is 68 in the US, but many people manage to do this sooner, but only by putting a plan together.
It’s never too late to start planning for your retirement. There are many simple things that you can do in life to make it happen that little bit sooner and put you in the best position not only to retire early but to give you the freedom to make that decision when you want to. Below are four simple tips to help you with the planning of your retirement.
Clear Your Debts
One of the first things you should consider when planning your retirement is to clear your debts. If you have a large amount of debt, then having these large monthly payments each month can be crippling and reduce the chances of you retiring at a younger age. The sooner you pay your debts off, the better you will be financially. There are many ways that you can pay off your debts quicker, from taking on extra work, to running your own business at home in the evening. As you get older, try to reduce the amount of money you borrow as nothing comes free in life, you will need to pay it back and in some cases with a large amount of interest.
Track Your Expenditure Before Retiring
Do you know how much your monthly costs come to? If not, then start to track them to make sure you know. There are many finance apps that you can download on your phone to track your income and outgoings. By doing this you can get to grips on how much you spend each month. This is vital as when you retire your retirement fund needs to be able to cover these costs. When tracking your finances you will also begin to understand where you are spending your money. It could be that you can make some cuts in order to be able to save more. For example, you may not realise that every day you spend $3 on a takeaway coffee as $3 doesn’t seem much. When you add that up you discover you are actually paying $90 a month which is a lot of money. You don’t have to stop it all together but you may want to reduce the amount of takeaway coffee you are getting.
See a Professional
There are many retirement experts who are worth booking an appointment to see when planning your retirement. These experts know all there is about retirement and will help you put the best plan together. It may be that there are certain costs that you were not aware of, or a bank account that you should put your money into that will give you the best return. Some of these financial advisers will be able to give you a call over the phone or will be happy to book a face to face appointment to see you. Before signing up to any scheme you should always speak to a financial adviser to make sure it’s the best decision for you.
When Should You Start Drawing Your Pension?
As with anything in life, there is a good time and a bad time to start drawing out your pension. There are also certain rules that you need to follow depending on which pension you opt for. Some pensions require you to be a certain age, whilst others will allow you to withdraw the money on top of working. Make sure you do your research on what pension is right for you, as this can make a big difference on when you can retire.
There are so many different things to think about when setting up your retirement plans. Our advice is to make sure you do your research and speak to a professional if you need any support (after all they are the experts). But as mentioned above, the sooner you start planning the sooner you will be able to retire and stop working.
Have you started planning your retirement? How has your planning gone and did any of the tips above help you? Are there any tips you would like to add to the above list? Let us know in the comment box below.