Wednesday, November 23, 2016, AM | Leave Comment
One of the most common concerns that many adults share is about their financial future and becoming ready for retirement.
Retirement can seem burdensome to save for, and this is particularly true for those who are nearing retirement age.
Regardless of whether you are getting a jumpstart or a late start on retirement savings, there are a few steps that you can follow to improve your financial situation and become ready for retirement.
Eliminate Unnecessary Purchases
In your financial planning efforts, it can be very helpful to scrutinize your spending and to cut down on unnecessary expenses.
For example, you may still be paying for a gym membership even though you have not been worked out in months. This is just one example of many expenses that may no longer serve a purpose for you, or that may be overcharging you for your time and effort.
Check your TV bill, small monthly subscriptions and other expenses you may be able to cut out.
Create a Solid Budget
After you have reduced your budget considerably, you may have several hundred dollars you can use at your discretion each month. This may be used to pay down debts that must be eliminated as part of your retirement plan.
For example, paying off credit card balances or eliminating the mortgage payment may be two of your goals.
A budget provides you with a plan of action to take so you can more successfully achieve your retirement goals.
Make Savings Automatic
Another important step to take is to make more of your savings automatic.
When you manually transfer funds from one account to another to build up your savings balance, you run the risk of forgetting to make the payment, or finding other ways to spend the money rather than to save it.
By automating your savings effort with a recurring autodraft or transfer, the funds will be taken out of your account and placed in your checking or retirement account before they can be used.
Plus, there is no possibility that you will forget to make a bank transfer when the process is automated.
Reallocate Your Portfolio
If you have already started saving money for retirement, now may be a great time to analyze and reallocate some of the funds.
The economy has slowly improved over the last few months, and now may be the right time to analyze your portfolio and to make reallocations for improved returns.
Be sure to adjust with future expenses you might have to pay. This could be healthcare like a senior day care center or new medications, or other future expenses like a new, downgraded house.
Refinance the House
If your home is not currently paid in full or if you will be carrying a loan into retirement, you may consider the benefit of refinancing to a lower rate and better term.
When you refinance your home, you can also shorten the term length in some cases. This can establish your monthly payments so that the home is paid off sooner than it otherwise would be.
It can also reduce interest charges while helping you to apply more money toward principal reduction.
Preparing for retirement can be a challenge, and you may wonder if you are saving enough to meet your goals. The reality is that most people are not, and you may be looking for ways to boost your efforts for even greater results.
These tips will generate exceptional benefits for you and your family, so try to put them into action today.
Eileen O’Shanassy is a freelance writer and blogger based out of Flagstaff, AZ. She writes on a variety of topics and loves to research and write. She enjoys baking, biking, and kayaking. Check out her Twitter @eileenoshanassy.