The majority of the time our busy lifestyles keeps us from planning ahead. If reality hasn’t hit you, it will to the fact that retirement is coming fast and hard…are you ready for the storm? Managing money for retirement is mostly overlooked, pushed back and the so called golden years do not turn out to be as glamorous as many envision. Are you ready? Do you have you plans in place?
For the majority of individuals the idea of saving for retirement is beyond their means, due to a need of concentrating on more immediate areas such as paying monthly bills, keeping ahead of the debt collector or even how to put food on the table before the money runs out. Understandably this is more on the minds of millions of people rather than the issue of saving for retirement days.
People go through their lives without total realization of what the lack of money preparation, or financial planning does to them or if handled properly what money can do for them.
Having money could make your dreams and golden years much more comfortable to enjoy. On the other hand the lack of money can put a person in dire straits and stressed out situations if we allow it to happen. And that is something we do not need as we get older.
The retirement years are meant to be good times, stress free, relaxing, doing the things we never were able to when we were younger and working (to make someone else rich). But wait how will any of this be possible if we let our money situation control our lifestyle?
For those who are now in their 40’s 50’s or 60’s and have little to no retirement set aside (and this is the majority of people) the road ahead is going to be a rough one filled with many holes and bumps.
Learn to “own” your retirement, learn to be in charge of your life, your money, … on your terms. Don’t let fear take control of your life.
Remember, Social Security was not meant to be an entire source of monthly income. It was intended to be a buffer beyond pensions, and personal retirement savings.
From millennials to baby boomers…with little or no retirement income planned out, our society will hit a HUGE “wall of debt” and forced to living in a money crisis. Who picks up the pieces when this financial wall tumbles?
How can you start your retirement planning and savings?
- Take control of your retirement plans, read and gather whatever information you can.
- Start making changes, learn to make good choices.
- Start small just get started. There are plenty of places to start saving for retirement no matter your present situation – there are plenty of sources to invest your money.
- Some individuals start out with a local financial advisor, or even a local bank
- See if your employer offers sources or better yet a 401k plan that you can easily get into
- Set up an automatic deduction (hey you don’t think about the other deductions that are already coming out of your pay, right?)
- Start your own Roth IRA and have a small amount deducted each pay period. There are many qualified places to put your money, you can do it on your own and quite easily on online. Check out places to open an Individual Retirement Account such as: Fidelity, T. Rowe Price, or Vanguard. There are many more places to choose from, these few are excellent places to start looking.
Robert C. Pozena senior lecturer at Harvard Business School has a recent article, titled This single act would help many Americans reach retirement savings goals where he talks about having an automatic IRA plan, how it should be in place between companies and their employees, and adminstrated by the Federal Government.. He makes a great point that “Automatic IRAs are a small piece of what America should do to forestall a major crisis as waves of baby boomers retire”.
So to conclude, here is what is needed to get started towards that wonderful retirement:
- Jump start your retirement plans with Dave Ramsey a well known financial advisor. His advice and experience has benefited millions of individuals and families, and is an excellent source to gather information and to help you get on the right track.
- You do not need to be an expert or a financial planner, but you should be in control of your money, understand what is going on with it and the best way to protect it.
- Just get going on your retirement plans. You can and will make changes along the way! Adjustments, improving your knowledge and continual planning will build solid strategies. Do not get to your retirement years and then say, “what happen, I do not have enough money to live on”.
- Determine what your budget will be once you leave the workforce. What will you need for a monthly income during those retirement years.
- Do not forget to include emergency funds when planning out your retirement plans. Life happens, like the car breaks down, appliances, the furnace needs replaced, cost of living always occurs, medical cost will probably increase. With retirement years spanning 20 to 30 years you will have major repairs and emergencies hitting you.
- You should have a decent size of emergency fund set aside before you even go into retirement. Realistically you should allocate a percentage of your monthly retirement income that is coming into your emergency fund account to make replenishments so you do not get hit with shocking costs of repairs throughout the years.
Managing money for retirement can turn into a nightmare if you allow it. As I said before, learn to be in control of your money and your own destiny. Determine how you want your later years to be and start doing something about it now. Take a look at Dave Ramsey’s advice, how he started out, had it all, lost it all, then went and completely changed his life. Check out his tips and professional advice right now.
Never stop learning… Angela