Many people think of retirement as some time in the distant future. They don’t realize that retirement is coming closer to them as time goes by. And since they keep putting off retirement planning, it might sneak up on them. And they may not have a plan about what they’re going to do or how much money they might need to do it.
You don’t want to be forced to keep working when you’re ready to retire. At the same time, you also want to have an idea of what you’d like to do with your time once you’re not working anymore. So it’s important to have a plan, both financial and otherwise. If you’re wondering whether you’ll have enough money to retire, here are a few things you may want to consider:
Ideally, What Would I Like to Do Once I Retire?
Do you have a dream of moving to Jamaica and lounging on the beach when you retire? Or do you want to have a home close to where your children live so that you can spend them with them? Have you been hoping to travel more? Or are there certain hobbies and interests that you would like to develop once you have the time to do so? You might even want to go back to school and finish that Ph.D. you started in your thirties.
Some of these dreams might seem impractical or even silly. However, they’re your dreams. So you have to do what you can to make them come true. However, the first step to actualizing your dreams is to know what they are. This means you need to sit down and think about what you’d really like to do. Write it all down if you want. Or just create a mental picture. Speak to your spouse about what they might want to do when they retire. This way, the two of you can come up with a plan together.
How Much Will It Cost?
Sometimes, the things that you want to do when you retire are pretty modest. Maybe you just want money to continue living the way you live and take a few art classes at the local community college. Or you might have bigger plans, such as moving to Jamaica.
It’s a good idea to do some research into how much everything is going to cost. If you retire at 65 and you come from a family of nonagenarians, you’re going to need to figure out how to live for 25 years, at the very least. You’ll also have to factor in the rate of inflation.
If you own your home, you’re in a good position. But if you have a mortgage that hasn’t been paid off or any other large loans, think about what you need to do to make sure that you aren’t plagued by these issues in your retirement years.
How Do I Prepare Myself Financially?
It’s a good idea to work with a financial advisor before you reach the age of retirement. Figure out what your options are. Does it make more sense to pay off your mortgage or other loans first? Or is it a better idea to make moderate payments and start investing the rest of your money? And if you’re thinking about investing, what types of investments would be best for you?
You can never go wrong with safer investments, even if they don’t yield too much in terms of interest. Your money will still be growing and you won’t risk losing it. At the same time, if you feel confident about moving into high-risk investments, with at least some of the funds at your disposal, it’s not a bad idea to do so while you’re still working. In general, a financial advisor will tell you to reduce the amount of risk you take on as you grow older and get closer to retirement age.
Contact us for more tips on planning your retirement.