Ways to get ready for retirement

Retirement, we’ve all imagined it—travel, leisure, relaxation. For most of us, retirement may be a long  way off, however preparing for it needs to start as early as you possibly can. If not, you may find  yourself in a position of financial insecurity during what should be your “golden years”. To avoid this  from happening, here are some tips for you to consider putting into action now: 

1. CALCULATE YOUR TARGET SAVINGS 

It’s easier to work towards a goal that’s identifiable. Financial Planners recommend that you  save between 10-15% of your income for retirement. However, everyone’s retirement plans  differ, so use an online savings calculator to determine the amount YOU need to save for YOUR retirement goals. 

2. CONTRIBUTE TO YOUR EMPLOYER’S RETIREMENT SAVINGS PLAN 

If your employer offers a 401(k), traditional IRA or Roth IRA and you’re not signed up, DO IT  NOW or AS SOON AS your employer allows you to! Set up automatic paycheck deductions— start small and increase the amount gradually. Chances are you won’t even miss it. Once the  money is in your retirement fund, don’t touch it! 

3. TAKE ADVANTAGE OF EMPLOYEE BENEFITS 

Many employers offer matching which usually requires you to contribute a certain percentage  of each of your paychecks and they will match that amount with money of their own. This is  basically FREE money your employer is giving you just for contributing—if at all possible, try to  put in at least the percentage that they match. Your employer may also offer health savings or  flexible savings account. You contribute to these accounts with pre-tax money, meaning you  reduce your taxable income amount which in turn allows you to save more money. 

4. PAY OFF YOUR DEBTS 

If you have debt, start by paying off any high interest credit cards first. Once that is done, take  the monthly amount you were paying on those and apply it to any other debts, such as student  loans and car payments until they’re paid off as well. 

5. PAY OFF YOUR HOUSE 

Adding a small amount to your monthly mortgage payment or making an additional 1 or 2 yearly  payments will significantly reduce the number of years you’ll be paying on your home. 

6. REDUCE DAILY SPENDING 

Spending your money wisely now can make a huge impact later. Track ALL of your spending for  a month—you will be surprised by the results. Taking a good hard look at your spending habits allows you to see exactly which areas you can cut back in. 

Give yourself the peace of mind in knowing that you have a retirement plan in place. Trust me,  you’ll be thanking yourself 25+ years from now.

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