More and more people are now looking at the options that they can take in order to ensure that they can live comfortably after they leave their careers. In the past, companies and employers were able to provide retirement and pension plans that were enough to sustain a person through his retirement years. Sadly, this is no longer true today. With a weak economy and loss of jobs, it is up to the you to prepare for your own retirement. Here are the top 10 tips that can help you prepare your your life post-career.
Invest in precious metals. Investing in precious metals does not have to be something you do to prepare for retirement. You can do this even as you are starting your career as one way to diversify your financial assets. Precious metals are not affected by the ups and downs of inflation, they serve as global currency, and the value of precious metals also tend to increase with time.
Assess your current financial situation. This will require an assessment of your current living expenses. Financial experts say that you will need up to 80% of your current earnings to live comfortably once your retire. You have to know how much assets and liabilities you have and how much you can save on top of spending for daily expenses and payment of debts if you have any.
Create a pre-retirement budget. Once you know how much you are earning, how much you save and how much you spend, it is important to create a budget.A budget is your guide to how much you set aside for your retirement and sticking to it can help you arrive at your goal amount. A budget is also important if you have existing debts to pay. You can use the budget to set aside money for debt payments and retirement so that you can pay off the debts as soon as you can and turn your full attention to saving up for retirement once you are finally debt free.
Do not touch your retirement savings. Never touch your retirement savings when you can. Be as aggressive as you can in saving up for retirement so you can reach your goal amount in the time frame you set.
Choose a Tax-Sheltered Savings Plan A tax sheltered savings plan is often offered by employers. If your employer offers a 401k to employees, contribute as much as you can. This type of savings plan can help with retirement if you contribute regularly since whatever your put in gets matched by the employer. You also benefit from lower taxable income and deductions later on.
Sign-up for an individual retirement account. An individual retirement account could be something separate from your personal savings. An IRA is offered by employers as well. If you are over 50 you can contribute up to $6,000 into an IRA and $5,000 if you are younger.
Invest in equities. Investing in equities is also one way to diversify. Equities perform better than other investment options over time, and are very ideal if you want to invest in something low risk but able to generate consistent and reliable returns. Government equities are ideal options since they are generally low risk. Most banks can help you invest in equities, especially government equities, eliminating the need for you to go to a professional broker.
Look into Social Security. Your Social Security benefits can give up to 40% of your pre-retirement income. Add that to the other sources of income such as investments on metals, equities and your retirement savings and you are on your way to a comfortable retirement life.
Review your plans on a regular basis. Experts recommend reviewing your retirement plans once every year. Major life events and other factors may occur and necessitate a modification of your retirement plan. It is important to review regularly to see how much you have achieved in that year and to see if you are still on track to achieve your financial goals.
Work with a financial adviser for more information and guidance. Working through all the options and the paperwork that comes with choosing a retirement plan can be confusing. A financial adviser such as Lincoln Financial can assist you through the process of getting your retirement finances in order so you can make wise choices for your future. Your financial adviser is there to guide you in the choice of investments, creating a budget, and in the modification of your retirement plans when needed.
Retirement need not be scary. With ample planning and preparation and by making the right investments, you can secure a comfortable financial future for yourself. These tips will work for you whether you are employed or not, so there is no excuse for not having a sound and working retirement plan as early as now.