Are you wondering how to secure your future? Especially during the time when you are old and looking for the much-needed peace of mind with your finances? Saving money for retirement is not an uphill task if you plan ahead of time. How much you’d need will largely depend on the lifestyle you plan on pursuing, things you intend to do when you retire and your retirement age. Here are a few pointers to help in planning your Retirement Investment (RI) and make savings goals easier.
Planning Your Retirement Investment (RI) & Savings
Planning for retirement can be tough but it can be very rewarding in the end. We’re going to look at a few tips that will make planning for retirement seem like a breeze!
Plan Your Retirement Ahead of Time
Planning for your retirement investment should be in your list of things before you retire. The earlier you start with it, the better. Evaluate your post-retirement needs well ahead of time and start setting up your savings goals. For example, if you are retiring 25-30 years later, then now is the time to begin your planning.
You can start by:
- evaluating your current expenses and savings, and then…
- create a strategy to offset the two metrics better.
Do not forget to include insurance plans, financial products or old age amnesty programs you think of using post-retirement. The clearer you are about the amount you will need once you retire, the better you can invest & save for that time.
Opt for the 401k Retirement Plan
Most employees are entitled to a 401(k) plan offered by the employer. It provides you with retirement funds to meet your financial needs. Using this plan, a part of your remuneration package is transferred to an investment account. By opting for the pre-tax contributions, you get discounts on taxes while letting your RI in the account grow with time.
Choose The IRA
Choosing an IRA can be helpful when planning your retirement. Especially if you are not comfortable with the 401k or fall short of the eligibility criteria for the retirement plans.
Even though an IRA offers similar benefits as those of a typical 401k plan, it still:
- offers more flexibility and control over your retirement
- provides a far greater ambit for investing
You can end up with a hefty amount in retirement for your old age. While the IRA offers similar benefits as those of a typical 401k plan, it provides a far greater ambit for investing and placing your money where you want. Visit the IRA official site first. Understanding an IRA investment plan is essential before your decision.
Use A Tracking App For Your Retirement Investment
To manage your retirement savings better, use an authentic tracking app or a monitoring tool that allows you to track your retirement investment or savings by age. A statistical tool to help generate timely reports on your periodic investment flows and savings stream. You could become well-positioned to channel your investment with efficacy, make your savings for the RI account burgeon with time and maximize on these savings without stressing about missed goals or timeline overruns.
Don’t Withdraw Too Much from Your Savings
If you are going to withdraw your savings rapidly and spend it on unnecessary things, then you will put your retirement income at risk. While planning for retirement we highly recommend that retirees opt for conservative withdrawal rates, especially for the money they need for essential expenses.
We did a little research by looking at the history and potential outcomes and we’ve come to a conclusion…
In order to be confident that the savings will last for about 20-30 years in retirement:
- Make sure you only withdraw around 4% -5% from your savings after you have retired in the first year. You can adjust this percentage for any inflation that happens in subsequent years;
- Work with a fidelity advisor to maintain a retirement income plan or,
- Consider an annuity with a guaranteed lifetime income.
Some of these items should become a part of your diversified plan. If done right, you won’t ever run out of money regardless of how the market shifts.
Avoid These RI Planning Mistakes
When planning for your retirement savings, be prudent about your finances and your personal requirements. It will help you understand exactly what goals you should set. Do not miss out on RI offers from your employer or a plan from the IRA. Moreover, do not make the mistake of cashing out your 401k savings beforehand. Even if you change jobs or leave an existing employer. Search for investment options carefully. Analyze each plan to weigh out the pros & cons before finalizing one.
Planning Your Retirement – Conclusion
We understand that after devoting yourself for years to save and invest for retirement, spending your savings can be stressful. Following the guidelines above can lead to your retirement and the years that come after. There is no way that you’ll ever have to worry about exhausting your retirement funds.
These methods have been tried and tested. They have helped millions of retirees live a comfortable life. With the right mindset and just a little bit of common sense, you can pull this off too.
Are you planning your retirement? Are you on track??
AUTHOR LaTia Longuemire
My name is LaTia Longuemire. I enjoy writing, singing, and cooking in my spare time. My passion is helping others. At this stage in my lifetime, I'm primarily focused on my children. They are everything that keeps my world spinning.