If you have already figured out what kind of retirement lifestyle you are aiming for, and you have some sort of picture of the costs involved in making that dream retirement lifestyle a reality, then you have to figure out how you are going to go about making that money! Meeting the costs can happen, as well as finding out the exact costs, especially if you follow these six steps!
Save As Much As You Can or Try Out An Investment Strategy
You need to have a good idea of the type of investor you are. Of course, this will have to be considered along with the amount of time you actually have left until your retirement day arrives. Ask yourself whether you are an aggressive investor or a conservative one or where in the middle you fall. If you have more time on your hands, you can afford to err on the aggressive side where time will cover up for any shortfalls in the long run. If you are already living the lifestyle you would want to continue into retirement, the mathematics behind it estimates that you will need approximately 80% of your pre-retirement income to live off of in the same means. Use online calculators to help gauge exactly where you stand. Make sure you also know precisely how much you need to have saved on the very day you retire!
Make Your Retirement Savings Your Priority
You have to budget. Unless you have somehow landed yourself an immense sum of money through inheritance, the lottery, or some or other means, you will have no choice but to budget and save up enough for your ultimate lifestyle by sacrificing your current one. It will all be worth it, but make sure you aren’t giving up so much that you forget to enjoy life and live for the moment as well. Just rearrange your spending so that you have more to put aside for retirement, especially as you get closer to the goalpost!
Pay Yourself First
Make your retirement contribution before you pay for everything else. After all, you’ve worked all month for those funds, so you deserve to pay yourself first. In the future, you will thank yourself for it! You will also be more able to manage any emergencies or unforeseen costs should they arise. Dipping into your retirement isn’t ideal, but it is good to have all your savings pooled together if you are earning compound interest on it. Let the magic happen!
Never allow yourself to bite off more than you can chew. Avoid spending money that isn’t yours – this includes buying on the account and on credit, and especially with personal loans that offer the worst debt. Perhaps if you really have to, a mortgage should be the only debt you get yourself into. Pay off whatever you have in full each month and don’t take on any more debt.
Race To Finish Off Debt
Whatever extra money you can afford to put into your debt payments, you should! In fact, paying off your debt should be more of a priority than your savings because the interest that you end up paying on your debt can accumulate to an amount greater than what you are actually getting from saving your money. So, if your interest rates are scary, decide to kill off your debt before you put extra funds in your piggy bank.
Do Your Homework!
Nobody wants any nasty surprises when it comes to retirement – especially of the financial form! Not having enough money is not an option, so do your math early and make sure that the amount you have selected for your retirement value is, indeed, the right value; otherwise, you may find yourself having to take up jobs out of necessity instead of as a hobby. Don’t just say that you will figure something out later. Do the math properly and make sure you have everything in order so there’s nothing to be afraid of as the date comes closer – just excitement!
Of course, this list is not exhaustive, but by following just these six steps, you will be on the road of a well-planned retirement. Don’t waste any more time – hop to it!