It’s a new year, which means it’s a new chapter for many of our lives. It’s important to look at the road ahead, from time to time, and to think about what we’re going to be doing at the end of the year, in five years, in a decade, and so on. You might start to realise that your working years are dwindling, and the prospect of retirement is becoming very real, indeed. So, what can you do to start preparing for it?
Controlling your financial habits
The more money that you are able to put aside, the better you can improve your retirement. Moreover, while you are retired, a little frugality can help you stretch any funds that you do acquire a great deal further than you might, otherwise. For that reason, you should get serious about your savings, and look at some of the most frivolous expenses you might be able to curb.
Shift away from making money via working
Financial independence should be your number one goal before you retire. Effectively, this means that your job isn’t responsible for producing the majority of your wealth. Instead, looking at creating an investment portfolio, balancing stocks, bonds, property, and other assets, can help you protect and further build your wealth as you head into retirement. Your career can still be a major part of your wealth generation process, it just shouldn’t be 100% of it.
Consider ensuring yourself an income
You might be able to live just fine on what savings you have put together by the time you reach retirement age, but for some, it’s reasonable that this isn’t enough. As such, you should look at options that can help you unlock an income. For instance, shifting your investments to those that pay dividends or setting ourself up with a retinal property.
Making use of your equity
By the time you reach retirement, you’re likely to have plenty of equity and to own your own home. You might want to keep that equity to pass the property onto your kids but, if that isn’t your plan, then a reverse mortgage can make good use of it as well. Effectively, this is getting a loan in exchange for that equity, which can be turned into an income or a lump sum payment, without having to leave the home.
Most important is to make sure that you don’t have any serious liabilities hanging over your head as you enter retirement. You should take the time to put together your total debt and, using a debt repayment calculator, figure out what you should be putting aside to get rid of them in a reasonable time-frame, allowing you to get into the latter stage of your working life without any concerns.
You might not be quite ready to retire just yet but the fact is that the sooner you start thinking about it and planning for it, the much better you will be for it. Don’t put off your retirement preparation for too much longer.
CANDY TAI is a wife to David and mom of 5 with a degree in Communications. She's a native Texan (Hook 'Em Horns!) who's been making her home in the Kansas City metro area for nearly 15 years. She loves being able to shuffle her kids from their various sports activities, piano lessons, and school activities. She enjoys fashion, beauty, reality TV, and moviegoing.