RETIREMENT SAVINGS PLAN FROM A-Z
Life is a journey, not a destination. In the journey of Life that consciousness of retirement savings should resonate within you. Everyone takes every step in a very unique way.
From beginning to end, life is full of a turning point- graduating from different levels of education, getting that first job, starting a family, buying your first home-but perhaps one of the most challenging is a comfortable retirement.
More than a matter of luck, it takes careful planning and implementation throughout your adulthood to achieve a stress-free retirement.
No matter where you are in life, there are always things you can do to prepare to be financially independent and be able to work, or not work, on your own terms. These include:
. Determine how much you need to save, and doing so
. Choosing Savings vehicles
. Selecting the mix of investments
. Protecting against uncertainties
More than Twenty five years left until retirement
At this stage in life , it is important to establish a strong financial foundation. Consider this tips:
Create a spending plan
Track your expenses, and use this information to create a plan for spending money. Your plan should account for monthly and non-monthly expenses.
Build an emergency fund
Deposit funds automatically into savings account until you have at least 3-6 months of expenses saved.
Pay off debt
Prioritize paying off high-interest debt (generally debt with interest rates greater than 4-6%) first.
Save for retirement
Contribute as much as you can afford to a workplace retirement plan. Save at least enough to get the full company match, if available.
Invest for the long the haul
Take advantage of your time horizon by investing more of your savings in long term instruments(e. g, bonds, stocks, real estate)
10-25 years until retirement
Keep your finances in order, while managing competing priorities. Here are ways to stay on track:
Run a retirement projection
Use a retirement estimator to determine whether you are on track to reach your retirement goal.
Estimate your life expectancy
You don’t want to outlive your savings, so use a resource to see how long you are estimated to live.
Adjust your strategy
Review your investment strategy, adjusting for changes in time horizon and tolerance for volatility, not past performance.
Manage risk with insurance protection
Protect income in the event of injury, illness, or death, with adequate life and disability insurance coverage.
Getting closer to Retirement
Less than 10 years until retirement
Manage and protect the nest egg you have worked hard to build. Consider these steps:
Evaluate income sources
Pensions, real estate and other assets provide income that may fluctuate in value but might provide a hedge against inflation.
Create a distribution strategy
Compare retirement income to expenses to determine how much you can afford to spend without depleting your nest egg too quickly.
Preserve your estate
Protect assets with long-term care and umbrella liability insurance, and make sure assets transfer efficiently to loved ones through proper estate planning.