Is a retirement filled with exotic travel, robust family reunions and overall fine living your dream? Or, do you have something less extravagant in mind? Whatever your retirement dreams may be, it is essential that you start financially preparing now. Below are 4 tips that will help you to maximize your income throughout your retirement.
- Analyze Income against Expenditures
The first step is to determine the income you can count on through retirement, the return on your current investment portfolio and the expenditures necessary to live the life you desire throughout retirement. For many people, this is quite an eye-opening experience. It takes a fine eye to weed out the necessities from the luxuries when considering budget planning for your future. After a decade or so of tough economic times that saw the dwindling of retirement funds, it is more important than ever to honestly analyze where you are today financially and where you want to be when you retire.
- Set Goals and Keep Them
Chances are, after the analysis of your retirement income and the monthly expenditures you expect throughout retirement, it will be important to add money to your retirement, investment or savings accounts. Now may be the time to downsize, while everyone else is ?upsizing.? By downsizing your home and your expenses, you can save more money for retirement, resulting in a more luxurious lifestyle. Set specific goals on spending and saving and keep them! By reducing your spending, you can save more but it takes discipline. It is also important to analyze the debt you currently have, to determine if it is good debt (mortgage on a house) or bad debt (high credit card balances with high interest rates).
- Pay yourself First
Once your have set your savings and investment goals, it is essential to prioritize your current expenditures, and pay yourself first. By saving first, you increase your chances of reaching your financial goals. When you don?t pay yourself first, you risk spending money on items that are not necessities, leaving nothing for your savings plan.
- Take Advantage of Benefits ? HSA, 401K
There is a wide array of financial benefits that you may not be taking advantage of. 401ks, Health Savings Accounts, tax shelters, investment accounts and more are available to help you reach your financial retirement goals. The last thing you want during the golden years is to be concerned with your financial stability; act now to take advantage of benefits that will allow you freedom in your retirement. A personal accountant can help you to select the best financial tools for your goals through an analysis of your current net worth, an analysis of your investments, life insurance, estate planning and so much more. Are you optimizing your tax relief through proper deductions? What debt should be paid off first? How much of your current monthly budget do you need to save in order to meet your goals?? Are you ready to make the sacrifices today to ensure your financial freedom in the future? With the help of technology and modern medicine, we are living longer than ever before. Some studies show that when the retirement age of 65 was set, we could count on another 10-12 years of life. By 2025 many experts believe we will routinely be living until our mid or late 80s or beyond, signifying our need to start saving and preparing for our retirement years.
