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How To Prepare For Retirement 

  • May 31, 2021

If you're reading this, I'm earning money. Thanks for helping to feed my family. Please see our disclosure for more information. Also, any advice provided is for informational purposes only. I'm not a CPA, lawyer, or doctor, although my parents wanted me to be all three. So, talk to a professional before acting on anything you read below.

Right now, you might not be thinking about retirement. Or perhaps you’ve decided that you don’t want to go down that route, and you feel that you would rather work for the rest of your life. However, it could be that you are very much looking forward to retirement; after all, it’s a time for you to relax, to stop worrying, and to do all the things you’re unable to do right now just because you have to work. 

No matter what you think of retirement in the present, even if you don’t think you’ll want to do it, it’s always wise to prepare for it. You never know if circumstances such as your health or a family situation will make you change your mind, and it’s far better to have plans in place and not need to use them than suddenly find you have to retire and have no idea what you’re going to do. Read on for just some ideas about how you can plan for retirement. 

Work Out Your Retirement Income 

The very first thing anyone will need to do when thinking about their retirement is to consider their income. You might be making good money at the moment, but what about when you no longer work? You might be making only just enough to get by; how will you manage when you retire? Either way, before retirement, it is time to think about this and put some plans in place. 

There are a number of different ways you can work out your retirement income. Savings are good, as long as they are in a high yield account, and investing – although riskier – can work well too. For example, buying annuities online means that you will have something to fall back on. Selling your assets, such as your property, is a useful way to fund retirement, and having a private pension in place is crucial, as this will enable you to choose what income you have and ensure you have enough to live on. Make this plan a priority, so you know that you will be able to cover all your expenses. 

Clear Your Debts Before You Retire 

If you are concerned that, no matter what you do, your retirement income is going to be less than you need, or that it will mean you can’t do all the things you want to do, even if you can still pay your bills, then look at your outgoings now. Are there debts to pay, such as loans, credit cards, car payments, and more? If so, make it a priority to pay these debts off as quickly as you can, without leaving yourself in greater financial difficulties, of course. 

By upping your monthly payments by a small amount, you can shave years off the total repayment time. If you’re unsure, speak to your creditors and find out what the calculations are. It might be that the difference of a few dollars can be all it takes. When you pay off your debts – and don’t get into further debt – your retirement will be much easier to prepare for. 

When Will Your Retirement Start?

If you are working for someone else, your retirement date might be chosen by them; it could be that once you reach a certain age (usually around 65-67), you will need to retire – check your contract to see if this is mentioned and speak to your employer to find out whether this is what they are expecting of you. 

If there is no particular date set, or you work for yourself, then you will have the choice of when to retire. If you are feeling fit and healthy and want to keep working past the ‘traditional’ retirement age, you can. However, having a date in mind will help you prepare financially and emotionally, so it’s a good idea to consider when retirement might suit you.

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