When you are busy living your life, you have little time to think about retirement. Your family and personal goals are foremost on your mind. Yet if you do not make time to plan for your retirement, the time to retire can come before you have set plans in place to provide for yourself and your family during your golden years. You may not be able to maintain the kind of lifestyle you would like to have during your retirement if plans are not put in place now. Instead of waiting, follow these simple steps to plan for your retirement now so your retirement years will be a reward for all those years during which you worked so hard.
Discover the Plans Your Employer Offers
Many employers offer pension plans, 401k, or other retirement plans as part of their employees' benefit packages. If you are unaware about what they offer, ask. If you are currently in the military or have served in the past, you may have a Thrift Savings Plan (TSP) or a military pension that you can access after you retire.
Discover Other Retirement Income You May Have
If you have money invested in mutual funds or stocks, you may want to derive some of your retirement income from these sources. Your spouse may also furnish part of your retirement income if she or he is still working or will have his or her own retirement income. Learn how you can access these sources of income long before you retire so you have a solid plan in place.
Discover What You May Earn from Social Security Benefits
To estimate the amount of money you may earn from your Social Security retirement benefits, you can use the calculator on the Social Security Administration website. At the bottom of the webpage, there will be a button. Click the button and follow the directions. After you finish the process, you will receive an estimate. While you are online, you may also fill out a form to request a copy of your Social Security statement, which you may access as many times as you wish. You should, however, check it at least on a yearly basis to make sure that they have an accurate record of your earnings. If they have missed any of your income, act immediately to notify their office of the error. To procrastinate on such an important matter can cause more trouble down the road, particularly if records of the missing income are unavailable after many years.
Discover How You Can Collect Social Security Benefits
People who retire, for example, in the year 2014 when they have attained their full retirement age, may collect a maximum of $2,642 per month in benefits. To collect benefits, you must meet several qualifications. If you have worked for at least ten years, you should have accumulated 40 credits, which is the minimum amount of credits you can have to receive benefits. The SSA will hold on to your credits until you earn the required amount of credits to receive benefits. Your credits will remain regardless of the number of job changes you have had. The more years that you can work, the more credits you will receive, which will translate into more dollars for your retirement income.
Discover Your Total Estimated Retirement Income
Now that you have identified each source of retirement income, calculate the amount of money you should receive from each of those sources. Doing so will help you to estimate whether you will have enough to provide you with the lifestyle you want after retirement.
Discover What Level of Income You Will Need
To make an accurate estimate of your retirement plan's adequacy, you will need to calculate how much money you will probably need to maintain the retirement lifestyle you want. When you calculate this estimate, you must also factor in the increase in the cost of living that usually occurs over time. Your current expenses, such as housing, transportation, utilities, and food will likely remain the same, with the exception of what you would spend on transportation to and from work. Add in a generous amount for recreation as well. With more time on your hands, you may want to travel more, attend more concerts, or pursue hobbies or charity work. If your projected income will not provide enough money to fund your desired lifestyle, you may want to consider creating another source of retirement income, such as another investment account or another job after you retire.
Plan To Get Out of Debt Now So Your Money Can Work for You
One of the most overlooked aspects of retirement planning is debt retirement. Ideally, your money should be working for you, not for your creditors. To pay off your debts as swiftly as possible, first list all of your debts. Make sure that you cover all of the bases€"mortgages, auto loans, credit cards, and other loans. Next, organize them in a list from the smallest amount owed to the largest amount owed. Pay off the smallest debt first, and then work down the list until everything is paid off. If you have assets that you do not use, such as an extra car or an extra home, sell them and pay off your debts with the proceeds. After you have paid off your debts, do not borrow any more money unless you have an emergency. In fact, you may be able to create an emergency fund that you can draw upon if you do have a future emergency. That way, your money may be able to earn a small amount of interest for you, while still a liquid asset that you can access if an emergency arises. Plan to retire debt-free for a retirement free from worry about monthly payments to creditors.
Discover the Plans Your Employer Offers
Many employers offer pension plans, 401k, or other retirement plans as part of their employees' benefit packages. If you are unaware about what they offer, ask. If you are currently in the military or have served in the past, you may have a Thrift Savings Plan (TSP) or a military pension that you can access after you retire.
Discover Other Retirement Income You May Have
If you have money invested in mutual funds or stocks, you may want to derive some of your retirement income from these sources. Your spouse may also furnish part of your retirement income if she or he is still working or will have his or her own retirement income. Learn how you can access these sources of income long before you retire so you have a solid plan in place.
Discover What You May Earn from Social Security Benefits
To estimate the amount of money you may earn from your Social Security retirement benefits, you can use the calculator on the Social Security Administration website. At the bottom of the webpage, there will be a button. Click the button and follow the directions. After you finish the process, you will receive an estimate. While you are online, you may also fill out a form to request a copy of your Social Security statement, which you may access as many times as you wish. You should, however, check it at least on a yearly basis to make sure that they have an accurate record of your earnings. If they have missed any of your income, act immediately to notify their office of the error. To procrastinate on such an important matter can cause more trouble down the road, particularly if records of the missing income are unavailable after many years.
Discover How You Can Collect Social Security Benefits
People who retire, for example, in the year 2014 when they have attained their full retirement age, may collect a maximum of $2,642 per month in benefits. To collect benefits, you must meet several qualifications. If you have worked for at least ten years, you should have accumulated 40 credits, which is the minimum amount of credits you can have to receive benefits. The SSA will hold on to your credits until you earn the required amount of credits to receive benefits. Your credits will remain regardless of the number of job changes you have had. The more years that you can work, the more credits you will receive, which will translate into more dollars for your retirement income.
Discover Your Total Estimated Retirement Income
Now that you have identified each source of retirement income, calculate the amount of money you should receive from each of those sources. Doing so will help you to estimate whether you will have enough to provide you with the lifestyle you want after retirement.
Discover What Level of Income You Will Need
To make an accurate estimate of your retirement plan's adequacy, you will need to calculate how much money you will probably need to maintain the retirement lifestyle you want. When you calculate this estimate, you must also factor in the increase in the cost of living that usually occurs over time. Your current expenses, such as housing, transportation, utilities, and food will likely remain the same, with the exception of what you would spend on transportation to and from work. Add in a generous amount for recreation as well. With more time on your hands, you may want to travel more, attend more concerts, or pursue hobbies or charity work. If your projected income will not provide enough money to fund your desired lifestyle, you may want to consider creating another source of retirement income, such as another investment account or another job after you retire.
Plan To Get Out of Debt Now So Your Money Can Work for You
One of the most overlooked aspects of retirement planning is debt retirement. Ideally, your money should be working for you, not for your creditors. To pay off your debts as swiftly as possible, first list all of your debts. Make sure that you cover all of the bases€"mortgages, auto loans, credit cards, and other loans. Next, organize them in a list from the smallest amount owed to the largest amount owed. Pay off the smallest debt first, and then work down the list until everything is paid off. If you have assets that you do not use, such as an extra car or an extra home, sell them and pay off your debts with the proceeds. After you have paid off your debts, do not borrow any more money unless you have an emergency. In fact, you may be able to create an emergency fund that you can draw upon if you do have a future emergency. That way, your money may be able to earn a small amount of interest for you, while still a liquid asset that you can access if an emergency arises. Plan to retire debt-free for a retirement free from worry about monthly payments to creditors.
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