Retirement planning is something that we all know that we should be planning for, but it can be a bit overwhelming, especially if you’ve never even considered what it means to be fully retired. This blog will dive deeper into steps that you can start taking at a young age that can greatly benefit you in the long run!
Monitor Your Investments Pre-Retirement
Money needed 5-10 years into retirement is the most vulnerable, so if you can, avoid overspending in your early years. This means carefully monitoring your investments and spending habits so that you can optimize and make the most of your money. Creating a budget that lays out all of your spending habits will be able to let you visually see where your money is going. You’ll then be able to see what things you can either cut out or spend less on. That coffee you buy every morning might not seem like a lot but by cutting out that cost can be put into a retirement fund. It may seem like a small amount, but every bit counts!
Utilize Your Company’s 401(k) Plan
If you don’t know, a 401(k) plan is a retirement savings plan that is sponsored by an employer. It lets workers save and invest a part of their paycheck before taxes are taken out. While participation in a 401(k) plan is not mandatory, you should think of it as a mandatory plan for your future. 401(k) plans allow you to invest money from each paycheck into your retirement fund and build that money up. We advise that you start utilizing your company’s 401(k) plan as soon as possible, the more you save the more you have and trust us, your future self will thank you.
Focus on Physical Health
This may seem unrelated, but we promise that it’s not! Your physical health is a huge part of the overall retirement process. Given the high costs of healthcare, focusing on your physical fitness today is key in staying fiscally fit in retirement. It can be easy to overlook health care costs, but these are costs that can really burden your finances when you consider the projections. So, by keeping yourself physically fit while engaging in a healthy lifestyle can help save you and your bank account from expensive health care costs.
Plan for Inflation
Inflation and rising prices can eat away at the buying power of retirement funds. Whenever you’re planning for retirement, just assume that the prices will go up. It’s better to have a bit of wiggle room in your expenses so that if prices do rise, it won’t catch you by surprise. Better safe than sorry, right?
Pay Off Your Mortgage
Your home provides a significant contribution to your fixed expenses. By paying off your mortgage you’ll be able to finally tap into your homes wealth by living there essentially “rent-free”, allowing you to be rid of a significant monthly expense.
This is probably something that you don’t want to hear, but working longer is one of the best ways to ensure that you have sufficient money for retirement. It’s also smart to plan on working longer than you originally planned. Even just a few extra years of income can significantly add to your retirement fund.
Work with an Investment Professional
Just as you see a doctor for your physical health needs, you should see an investment professional for your financial needs. At Integrity Wealth Management and Insurance Services, LLC, we specialize in retirement planning. We look specifically at your needs and wants and help you find the best plan for you. Many times, retirees are approached by some type of insurance salesman or non-fiduciary who claims that they can help assist them in their retirement. These plans often boil down to a strategy to make the client money, typically failing to take into account the retiree’s financial goals, challenges and opportunities. The difference is with us, we assemble all the pieces of your financial puzzle, allowing them to all seamlessly fit together. Let us help you maximize the money that you’ve saved for retirement and ensure that there are no gaps in your financial plan. Contact us here or call us at 714-947-0105.