Some would disagree but it is never too late to start your retirement planning saving.
Even if you are in your 60s there are things you can start today. So here are eight tips to jump start a retirement plan in your later years:
1. Understand your current spending habits
Be aware of your current spending habits and calculate how much money you will need to live comfortably in the future.
2. Get a retirement planning expert
Meet with a retirement planning expert to develop a strategy that will take into account all of your needs and wants.
3. Pay off debt
Paying off debt should be a top priority. Once debts are paid off start putting whatever you can toward retirement savings. Even in small increments it will begin to add up.
4. Live off a budget
Practice living on a budget and eliminate unnecessary spending. When you reach retirement you will need to learn to live on what you have saved and not go beyond what has been budgeted.
Practice living on a fixed income now to get used to your lifestyle once you do retire.
5. Don’t depend on Social Security benefits
Many believe that Social Security alone will cover their needs; this is often not the case. According to the Social Security Administration, the average Social Security Check for all retired workers is $1,657. In addition they project that:
- Social Security’s combined trust funds are now projected to be able to pay scheduled benefits only until 2035.
- But if nothing is done to shore up the program, just 80% of benefits will be payable at that time.
6. Have a 401k
Participate in your employer’s 401k plan for savings. Many employers will match your contribution up to a certain level; take full advantage of this to maximize your return.
7. Build your savings
Build your savings in a Roth IRA account, while diversifying your investments in stocks, bonds, mutual funds and more.
With the Roth IRA, contributions are made with after-tax dollars and withdrawals are generally tax free. Any transaction done within the account has no tax impact.
8. Plan a phased retirement
Going from working five days a week to not working at all is major lifestyle change.
Consider a phased retirement where you work a couple days each week or just a few months out of the year.
Conclusion - retirement planning in later years
Many have been impacted by the recession with unemployment, a plummeting stock portfolio and losses in property values.
Accept the reality of the current economic situation, but don’t let it deter you from reaching your goals.
It may take more time to retire than you originally hoped, but being proactive in your approach will eventually get you there.