Wise Financial Pre-Retirement Tips
By Jason Boden
Fact: Retirement is inevitable.
People in their later years worry about retirement as it forebodes a multitude of problems; especially financial worries.
However, we cannot deny the fact that retirement is a period we’ll all go through in the later years of our lives. In one way or another, we worry that there might not be too much to look forward to, especially retirement is associated with words “stagnation’ and “burden’.
Considering that saying adieu to our past life is approaching, it is an imperative that we must plan ahead for this event in our life. Despite this foreseeable event in our elderly years, most people do not fully enjoy their retirement due to problems relating to financial management, increased costs of health care, and spending their years alone. In a study done in America, out of 100 people who started working at the age of 25, only 1% believe that by the age 65, they will be wealthy. Furthermore, 63% are dependant on Social Security, friends, relatives or charity.
These statistics alone denote a sorry-state of being dependent, therefore shrouding the term “retirement’ as a sordid, perplexing state of existence. However, retiring isn’t exactly that depressing; you can avoid the stigma by planning far ahead, even in your twenties. Check out these guidelines you could follow to prepare positively for retirement:
Acknowledge the Fact of Retiring
It’s like what they say: Face your fears. You cannot deny the fact that one day, you’ll be 60 years of age. On an average, you have been working for the past 35 years of your life, and that day would come that you’re not going to work anymore. One of the most common worries of those who will retire is being dependent to their relatives. Another one is ending up in nursing homes or hospice care. Though it has somewhat become the norm in an elderly’s life, some people would like to avoid that outcome. Accepting the fact that you’ll be retiring in the future will make it easier for you to plan ahead for that event in your life.
Save Money for Retirement
Financial matters are indeed one of the main worries of pre-retirees. Why not prepare for this by saving money from this time forth. It’s understandable if you want to experience the luxuries of life while you are young, but setting aside money for the future is also an imperative. You can start with an emergency fund, that later on could be your retirement fund. Going into retirement means leaving behind your main source of income. There’s no adequate amount to reach; you’ll never know when you’ll need more or less of your savings. To keep your savings safe, you can open a separate account with a reputable bank that offers term or time deposits.
Check out Unit Investment Trust Funds
Unit Investment Trust Funds or UITF is a pooled fund investment managed by professional investment managers. UITF its where people put their money, with an investment manager handling the investments. UITF is a good vehicle if you’re planning to save and invest long term. It’s a low risk investment option for those who would like to invest but don’t have much time to understand the complex terms of financial markets or those who just want assurance that their money is on the safe side
Social Security and Pension Plans
It was mentioned earlier that most retirees rely on Social Security and pension plans. While most people are availing these financial plans, most of them do not really understand where their money is going, and why they set aside funds for the said plans. Determine the objectives, risks and ROI of your plan. Keep in mind though that while it is great to have a pension plan of your own, it is good to diversify your assets and get a Social Security fund as well. Both can help you safeguard your financial future for your retirement.
Taking the Risk with Financial Market Investments
With the innovative technology now available in the palm of our hands, it is now possible to perform trades in the most popular markets in the trading industry today. Stocks, forex, and binary options are the most popular vehicles of investment for the aggressive investor. If you’re knowledgeable with how the market works, why not take the risk and trade? These three choices are proven in terms of generating income; however, with the common mentality of spending money right away, these financial opportunities are most often overlooked.
Still Employed Even At 60 And Beyond
Your day job may mean a lot to you. If you’re six feet from the edge of retiring, but you still deem yourself capable of working, why not consider part-time employment? It is hard to break the habit of hustling and bustling that you have been doing for almost 30 years of your life. If you want to stay in the work force, there are companies and jobs that accept workers even past the age of retirement.
Be Active and Stay Healthy
Considering that the age of retirement is seemingly plagued with different kinds of diseases and ailments that can affect you and your pocket, being active and staying healthy at an early age can help reduce the toil on your savings. Watch out for your family’s history of illnesses can help you determine which things and activities to avoid especially if you’re prone to common diseases afflicting the elderly. Opting for a health insurance can also help you safeguard your finances.
There are a lot of concerns you need to take into consideration when you retire; these are just the basics you shouldn’t miss. Basically, retirement isn’t really the end of life; it is the beginning of a new journey as you manage what you have sowed in the past years that you have worked hard for. Remember that retirement is a phase that we’ll all eventually get into; it’s all a matter of acceptance and proper envisioning of the future that awaits you.
If there are tips that we missed out, or if you have a question, please feel free to leave them in the comments!