Even if you already know what you want to do in retirement, saving to get there can be a real challenge. You might have a mortgage, credit card bills, or business aspirations that limit your ability to put aside money in the present. No matter your circumstances and situation, though, you can still adopt strategies to set yourself on the right path toward a comfortable retirement.
Think About What You Want Out of Retirement
Everyone has a retirement dream. Some people want to move to a different state—or even a different country—while others wish to simply spend more time with family. Some people, too, may not even want to go into “full-time” retirement: a physician might still wish to practice part-time, while a life-long educator may wish to continue working with children as a tutor or mentor.
One way or another, you can’t really plan for retirement without thinking about the sort of lifestyle your retirement will entail. It’s also worth considering what you might need in retirement: money for health care, for instance, or an assisted living facility. Once you have identified your retirement wants and needs, you can set a savings goal to help you get there.
Think About Your Budget
Some people are great with budgets, while others dread the thought of sitting down and adding up their expenses. However, setting a budget and making a long-term financial plan is integral to having a happy, healthy, and fulfilling retirement. For the vast majority of Americans, Social Security is not enough to retire on—especially if you’re planning to pursue the same lifestyle you’re living now.
Your budget can help you identify where you can save money, and it can also help you determine the best way to save for later. Depending on your expenses and income, you can figure out whether it’s better for you to put aside a set amount of money or a percentage of your income each month for retirement.
Consider Your Existing Opportunities
If you work full-time, there is a good chance your employer might offer some help with retirement. Your company might offer a 401(k) and may even match a substantial percentage of your contribution.
Even if your employer does not have a 401(k), you could still benefit from an investment retirement account or IRA. An IRA lets you save for retirement by putting savings into the stock market, accruing both interest and offering the potential for good returns.
Taking advantage of a 401(k) or IRA can also benefit you in the present: the federal government wants retired people to live independently and provides many tax incentives designed to reward people for investing in their own retirement.
Plan Your Estate
While you may not wish to think about your own death, estate planning provides many strategies to protect your assets both in life and after death. In fact, some estate planning tools—like a specialized trust—can reduce your tax burden when you are still alive and eliminate your loved one’s need to put your assets through probate after you have passed away.
The Importance of Smart Retirement Planning
If you’re like most people, your retirement planning goals and strategies will change over time. But considering your retirement goals, setting a budget, taking advantage of employer-sponsored plans, and protecting your estate provide you a baseline that you can adjust as needed. After all: it’s often easier to change a comprehensive plan that you already have in place than it is to start from scratch when you’re only a few years shy of retirement.
A wealth management professional can help you take stock of what you have now and where you want to go in the future to create a customized retirement plan that puts more money in your pocket today while ensuring there’s plenty left when you no longer wish to work.
Contact Us Today
No matter how far along you are with your plan, Quraishi Law can help you reach your dreams. Contact us to schedule your initial consultation.