The era of the gold watch and commemorative plaque is coming to a close. Retirement now means taking charge of your destiny and planning for the lifestyle you wish to lead. But, it does not have to be as daunting as it sounds.
Retirement Planning Basics
Why should I plan ahead?
While you may think of Social Security and pensions when you consider retirement, the truth is that those avenues will likely not be enough to cover your expenses. Thankfully, many people are living longer, more active lives in retirement. However, this means more disposable income is needed to cover those adventuresome years—in Phoenix or abroad.
Also, it’s far more prudent to count on something you have power to influence. Whether you opt for a Traditional or Roth Investment Retirement Account (IRA), mutual funds, or a diverse investment portfolio, you will know exactly how hard your funds are working for you.
Finally, you do not know how your health will evolve over time. It is best to build in the right buffers and guidelines to ensure your quality of life remains high as well.
What steps can I take now?
- Vision cast. Write down your goals . . . your bucket list. Know what “fantastic” looks like as you enter this new phase of life. Consider using a journal to jot down specifics.
- Assess wealth. Determine the assets you have, the income streams you do or will have, and the physical belongings you have around you.
- Boost savings. Find creative ways to cushion your savings and empower yourself to invest strategically. This could be cutting cable channels or curbing your latte habits.
- Pay forward. Do your utmost to pay off lingering debt, particularly anything with higher interest rates, now. The goal is to be in as little debt as possible at retirement.
- Forecast your budget. Take your retirement budget for a spin. Think of things like housing, food, travel, insurance and healthcare. See what you will need each month.