GETTING READY FOR RETIREMENT - DIY TIP ROUNDUP - 2023

HOW TO GET READY FOR RETIREMENT – DIY TIPS – 2023

For most people, retirement feels like a long way off. But, if you don’t start preparing as early as possible, you may find yourself in a place of financial insecurity when the time does come. To avoid this, consider implementing the following tips.

Calculate your target savings. In general, it’s recommended that you save between 10 to 15 percent of your income for retirement. However, you can always use an online savings calculator to determine the amount you need to save for your specific needs and goals.

Contribute to your employer’s retirement savings plan. Does your job offer a 401(k), traditional IRA, or Roth IRA? Sign up and start saving as soon as they allow you to. It’s recommended to set up automatic paycheck deductions and, once the money is in your retirement fund, don’t touch it.

Take advantage of employee benefits. Many employers offer matching which generally requires you contribute a certain percentage of each paycheck and your company will then contribute a matching amount with funds of their own. They might also offer health savings or flexible savings account. By contributing to these accounts, you reduce your amount of taxable income, allowing you to save more money.

Pay off your debts. Start by paying off any high-interest credit card debt first. Then look at other debts, such as student loans and car payments, and make a plan for paying those off incrementally.

Reduce daily spending. Although this feels like a no-brainer, spending your money thoughtfully now can make a big impact later. Seek out areas of your life where you can

This year’s TOP DIY RETIREMENT – TIPS

What should younger people be thinking about in terms of retirement?

For younger people, retirement might seem like an extremely distant concept, but it’s important to start thinking about it early to set a solid foundation for financial security in the future. Here are some key considerations for younger individuals regarding retirement:

Start saving and investing early. The power of compound interest can greatly benefit those who start saving for retirement as soon as possible. Even small contributions made consistently over time can grow significantly due to compounding. Consider opening a retirement account such as an Individual Retirement Account (IRA) or a workplace retirement plan like a 401(k) and contribute regularly.
Set clear retirement goals. Determine how you envision your retirement lifestyle. Consider factors such as where you want to live, the activities you’d like to pursue, and the level of financial independence you desire. Having clear goals will help guide your savings and investment strategies.
Understand different retirement vehicles. Educate yourself about various retirement savings options, such as traditional IRAs, Roth IRAs, 401(k)s, or other employer-sponsored plans. Learn about their tax advantages, contribution limits, withdrawal rules, and any potential employer matching programs. Seek advice from financial professionals if needed.
Build an emergency fund. Having an emergency fund is crucial to handle unexpected expenses or financial setbacks without derailing your retirement savings. Aim to save three to six months’ worth of living expenses in an easily accessible account.
Manage debt wisely. High-interest debt can hinder your ability to save for retirement. Prioritize paying off high-interest debt, such as credit card debt or student loans. Develop a debt repayment plan and consider strategies to reduce interest costs.
Develop a diversified investment strategy. Investing in a diversified portfolio can help grow your retirement savings over the long term. Consider a mix of stocks, bonds, mutual funds, or exchange-traded funds (ETFs) based on your risk tolerance, time horizon, and investment knowledge. Regularly review and adjust your investment strategy as needed.
Continuously educate yourself. Stay informed about personal finance and retirement planning. Read books (Dave’s the BEST!), attend workshops, follow reputable financial websites, and consider consulting with a financial advisor. Building financial literacy will empower you to make informed decisions and maximize your retirement savings.
Consider future healthcare costs. Healthcare expenses tend to increase with age. Research and understand healthcare options, such as Medicare, and consider the potential need for long-term care insurance (becoming very expensive the longer you wait.) Incorporate healthcare costs into your retirement planning to ensure adequate coverage.
Maintain a healthy lifestyle. Taking care of your physical and mental well-being can have long-term financial implications. By maintaining good health, you may reduce healthcare costs and enjoy an active retirement.

Remember, everyone’s retirement journey is unique, so it’s essential to tailor your approach based on your individual circumstances and goals. Regularly reassess your retirement plan and make adjustments as needed to stay on track. Perhaps, you might even explore the possibilities you could make money from your home.

Items such as long-term care are never on peoples mind until they, or someone in their family has a need.

I recommend you study the different aspects from time to time, just to keep anything from surprising you. We are all getting older, it seems.

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