Many people don’t feel they can afford to save for retirement. Others don’t want to spend the time doing what’s necessary to ensure they have the money needed to enjoy their golden years. Don’t fall into that trap. Here are some steps to help get you on the right path to a successful retirement:
Build a Road Map for Retirement
Do you want to move somewhere warm? Do you want to travel? Are you interested in taking up an expensive hobby? However you decide to spend your final years, it’s a good idea to make a plan based on what you desire, so you can financially prepare for it. Set aside some time to make a road map, by jotting down the places you’d like to travel to, where you want to live, what kind of housing you want, etc. By planning what your golden years might look like, you can better create a savings goal.
Spend time researching costs associated with housing, travel, hobbies and other items on your list, so you can estimate how much it might cost. When you’ve finished your research, compare the costs for your dream retirement to your estimated income. If you have enough to cover the lifestyle you want that’s cause to celebrate! If not, you’ll need to make some adjustments. This means building up a bigger nest egg to achieve all your goals, or cutting back on some of those goals to reduce your retirement costs. Tip: Remember to consider health care costs like Medicare premiums, deductibles, copays and insurance!
You won’t be able to reach your retirement goals unless you make saving a priority. Sit down and figure out what you’d like to save money for in retirement, then make your plan. Start by:
- Setting a timeline to reach your goal.
- Creating a schedule that divides your total money goal by the number of months between now and your retirement date, so you know how much you need to save.
- Setting up an automatic savings withdrawal. If you never see the money, you won’t be tempted to spend it. Have a portion of your paycheck deposited automatically into a separate savings account.
- Treating your savings contribution like your other necessary expenses – mortgage, groceries or utilities.
Trim Your Budget
It’s a good idea to go over your budget and tighten it up to save more money for your retirement. This can be as simple as replacing cable with a Roku or other streaming device, eating out less often, or cutting back on your grocery budget. If you can sacrifice something now to save a few dollars every week, that extra money will go a long way toward retirement. The earlier you start, the more money you’ll save. You’ll also get in the habit of saving money and taking care of your finances for the future.
Find Extra Retirement Income
Finding new ways to generate additional income can help give you extra security after you retire. You may not have to save as much from your main paycheck and your goal will be easier to achieve. Consider a part-time job or side gig that you can continue in retirement. Not only will you have more money coming in, you’ll find it easier to transition from working full time to not working at all.