Things to consider that will shape how you retire
Remember when you bought that one thing that you really didn’t need and it felt like a waste of money? Chances are you could’ve used that money for something more worthwhile like paying off a debt or even using the money to invest or save for a specific financial goal. The financial decisions you make today can ultimately have a huge impact on your future – and more specifically, your retirement.
Saving isn’t always easy to do, especially when you have so many other things to do with your money, but making the decision to put something aside for tomorrow is a lot easier once you take the time to envision what life in retirement could be if you don’t have enough. Here are practical suggestions you should consider to help you make sound financial decisions for today and tomorrow.
1. Plan it. Create or revisit your financial plan so that you can identify new or existing money goals and objectives, followed by a strategy for making those things happen. It’s a great (tool) to help build wealth, make ends meet, and everything else in between.
2. Know the ins and outs of your money. Conduct an audit of your finances so you can get a clear grasp of your current situation. Make a list of all of your assets, and then subtract existing debts to figure out your net worth. While you're tabulating, find out how much you bring in and spend each month so you can get a clear picture of your spending habits. This will help you make smart choices in regard to spending and saving.
3. Retire debt. The reality is when you retire, you will be living on a fixed income. Entering retirement with debt means you'll have less flexibility in spending your money, so it’s important to get rid of existing debt and not create any new debt. Try to pay off credit card balances, high-interest loans or balances for other accounts where interest is high.
4. Save more and more. Building up your savings is the most important part of planning. Doing so can help avoid financial emergencies such as home or car repairs, taking care of bills if you should miss time out of work, etc. Consider contributing those extra income opportunities like tax refunds, bonuses, and even reimbursements. Investing in the right products also can help you grow your savings.
There will come a time when working stops, so do all you can to be in the best position for a better tomorrow. Retire well!
For more on making financial decisions for yourself and your family, read more on blog.voya.com.