Thirty years seems like an eternity away. But, it will be here faster than you think. Will you be ready? As you are considering making financial changes in your life, contemplate if some of those changes might be made to your retirement finances. Retirement can seem like an unsolvable puzzle, but here are five tips to help you find the solution.
Know Your Finances
Because retirement is so far away, investing in it gets pushed aside by the mortgage, car payment, debt repayment, etc. While all those bills are necessary to pay, take the time to sit down and actually figure out where your money is going each month and how much, if any, you have left over after the bills are paid. That will determine how much money you feel comfortable investing into a retirement account. This doesn’t mean giving up your car to invest into a retirement fund, but it might me giving up that pizza. If no money is left over, find simple ways to cut back and have a few dollars to start investing.
Talk To An Adviser
Once you have an idea about how much you feel comfortable investing, talk to an adviser you trust! Plenty of individuals have lost their retirement by investing in the wrong person, so make sure this is someone you trust will handle your money honestly. Be sure to explain to your adviser:
- Your retirement goals
- How you expect to retire
- The amount you can comfortably invest each month
- Your plans to gradually increase that amount
Be willing to work with your adviser and set specific goals. For example, once you pay off debts, consider increasing the amount you invest each month.
Figure Out Your Number
As you are consulting with an adviser, be sure to figure out an actual number of how much money you need to survive retirement. Be aware…the number will be staggering and dumbfounding. Don’t pass out when you hear it, breathe and figure out a simple solution to reach that number. Many people retire quite comfortably, but it takes sacrifice today and TIME! They don’t retire at 25. The key to retirement is starting as early as you can to earn more interest on your money.
Find The Best Account
There are a variety of different accounts to help you succeed in your retirement goals. The two most typical accounts are a 401K and a Roth IRA. These two accounts offer great interest rates for your money. Be sure the money you invest into these accounts is money you can invest and leave alone for many years. These accounts aren’t your checking or savings accounts; they are set up specifically to help you retire. So, invest your money and forget about it until the blessed day of retirement comes!
The best way to increase your retirement account balance is to start today. Don’t wait until tomorrow or next year to start working on the puzzle. The puzzle will never get done if you never sit down and start working on it; same with your retirement. Don’t just assume you will have the money you need to live on after you retire. Start today to ensure you can enjoy those years later in life.