Do You Have A Financial Plan For Your Retirement?

by Pam on November 20, 2015

retirement planningFancy living on a tight budget during your twilight years? Want to survive freezing winters without a heated home? Like the idea of eating cheap, discounted food? No, then you need to start planning for your retirement. It might seem like a long way away – 15, 20 or maybe even 30 years, but the truth is, it will sneak up on you.

Your retirement might seem a long way off, but whether you are in your 20’s or 50’s, you need to have a plan in place. The reality is that if you want to enjoy your retirement, you need to start putting something away each month. Otherwise, the sad truth is that you’ll struggle to get by.

If you don’t already have a financial plan in place for your golden years, don’t panic, it’s not too late.

Clear your debts

The first thing that you need to do is clear your debts. You don’t want to be retired and having to use your savings to pay debts, do you? Aim to clear at least 90 percent of your debt by the time you reach retirement so that you don’t have to stress about paying extra things off.

Each month put aside an affordable amount of money to clear your debts. Whether that’s $200 a month or $50, it doesn’t matter, just as long as you steadily pay things off.

Start saving

As well as paying a small percentage of your debts each month, it’s also important to put aside some of your paycheck as savings. Financial advisors recommend saving at least 10 percent of your pay each month, for your retirement in a high-interest ISA.

When choosing an ISA, looking for a bank that offers tax-free accounts. That way, you won’t lose any of your savings to high tax rates. For help selecting the best account to save in, contact a financial advisor.

Get your employer involved

We don’t mean go up to your boss and ask him to contribute to your pension, what we mean is join your company’s pension scheme. If your company doesn’t offer a traditional plan, they may offer a super fund scheme. This is where your employer will pay an agreed amount of money into an account as a form of pension each month.

For everything that you need to know about getting a super fund set up, contact your local self managed super fund advisors. By speaking to an advisor, you can ensure that you have all the right information about super funds.

Consider investing

If you have a good 20 years until you reach retirement, and already have some savings, consider investing them. If your savings are low, and you don’t know how you will boost them to the level they need to be at, investment is a great option. As long as it’s a low-risk investment, that is.

There’s no point investing in high-risk stocks and shares when you are relying on your savings for your future. Instead, consider investing in property – one of the lowest risk options. While property is a fantastic investment, it’s important to understand that it will take at least ten years for your money to increase. So if you don’t have long until your retirement, property investment may not be suitable.

No matter how old you are, thinking about your retirement is important. It may seem a long way away, but trust us, those twilight years will soon sneak up on you. Want to be financially comfortable – then you need to plan ahead.


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