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Retirement is that prime time in life when you can relax and be carefree! But in order to be relaxed and carefree, it is vital that you take the time NOW to prepare and save. Below are a few methods you can start implementing now to secure a solid retirement savings!
Be Mindful of Emergencies
One thing that most people forget about when pondering retirement is the possibility of an emergency or emergencies. Once you retire, a number of expenses will suddenly no longer be covered by your workplace and health care costs are more likely to rise due to your age. Other expenses could include,but not be limited to:
- Home repairs
- Vehicle maintenance
- Helping children/grandchildren in a rough patch
- Emergency trips to the doctor/hospital
- Emergency trips out of town
If you do not have an emergency fund, you could be in big trouble!
The best thing to do is make a rough estimate of how much money you think would be necessary to cover these kinds of possible expenses and factor an amount to put regularly into your fund towards saving up to that goal.
Remember You Need Health Care
As stated above, the costs of health care will increase when you retire. As a result, it is important that you make sure to be mindful of this while you are saving up. USA News gave some great bits of information to consider when thinking about our health care coverage under retirement:
- If you currently have health insurance through your employer, you’re probably paying only a fraction of the monthly premium. The employer subsidy will be gone once you retire..
- If you retire before 65(the age when you will be eligible for Medicare) you will have to obtain coverage through your state’s health insurance exchange. That coverage could be expensive when you’re in your late 50s or early 60s.
- When you do finally qualify for Medicare, you’ll have to pay a premium to participate. The Medicare monthly premium will be $121.80 for new beneficiaries in 2016, and those who earn more than $85,000 per year pay even higher premiums.
- If you are on Medicare, you will almost certainly need to obtain Medigap coverage. The premium for that coverage can add several hundred dollars per month to your Medicare premium.
Try to be Debt-Free
One surefire way to ruin your retirement is to go into it with a ton of bills! Remember, you will no longer be working a 9 to 5, so if you’re busy paying off your bills, you won’t have time to enjoy the money you worked so hard to save!
Start paying off big things like credit card debts and education loans so you won’t have to worry about that money coming out of your retirement. After that you are able to start working on various other bills, such as car payments and mortgages. If you have those expenses handled before you retire, you will have all kinds of money at your disposal to enjoy and use for other things you need!
Keep an Investment Strategy
Investments are another great way to secure money for retirement; however, the market can get pretty turbulent, causing you to be at great risk, depending what your investment is in. That is why it is so important to understand what you’re investing in and to keep up with the market as time changes.
As you get older, you have to understand that taking chances on certain investments are not wise. When you’re younger you can afford to take investment risks, but when you are older the risk is simply too high to mess around with. Invest wisely so you can have a nice return and financial security.
Leave it Alone
Last but not least, leave your retirement money alone! Some people start to save money for retirement, but over time tend to dip into it from time to time for certain expenses. At first it may seem okay, but when you get to retirement and realize that you have nowhere near enough to live on, it is a problem!
If money is tight for you, just take a portion and put it into your fund – you do not have to deposit your entire paycheck! And if to realize that you cannot keep up the amount you initially started to pay, it’s okay – just decrease it to an amount that you know you can afford and go from there. Simple as that. You’ll thank yourself later when you see how much money you’ll have saved up!
Retirement is a time of rest for those who have been working for decades – don’t allow this time to be stress-filled because you didn’t prepare! Keep these tips in mind until retirement and you’ll be good to go!