Retirement can be fraught with worry, or it could be the best time of your life. Ultimately, what makes for a great retirement is stability, specifically, financial stability. The good news is that you can start planning today, even if you’re in your 40s, 50s, or even 60s. All it takes is the right know-how, and you can begin building that know-how with this easy guide.
- Your Finances are Unique: Call that Planner
One of the first things you should do is call a financial planner. These planners can help you manage your assets before you retire, clean them up if you’re already on the cusp of your retirement, and can even help you with estate planning to ensure that your loved ones or preferred charities get as much of your funds as possible after you pass on. It’s all tied together, and a professional financial planner can help guide you through your finances so you can maximize your retirement experience, whether that’s through financial stability or peace of mind.
- Maximize Your Retirement Contributions
If you’re still working, it’s time to maximize your retirement contributions, or to use catch-up contributions to boost your retirement funds that little bit extra just before you retire. Catch-up contributions are available to those who are over 50, so any time after that age, it’s important to go through and maximize your contributions as much as you can.
- Adjust Your Bond and Stock Shares
One of the more advanced ways you can start preparing for a wonderful retirement is to pre-plan how much you can and want to take out from your retirement nest egg after you finish working. In general, the 4% rule is where you’d take out 4% of your nest egg annually (adjusting for inflation). The problem with this rule, however, is that it assumes you have a portfolio mix where 60% of your investments are in stocks.
This does not mean you need to change your investment portfolio, but instead you’ll need to adjust, based on your own portfolio, what you could reasonably take out per year to avoid running out of funds in the future. This could be more, it could be less, and it may even need to change on a year-on-year basis depending on the stock market. The only important factor right this second is to ensure that the percentage you are looking at is enough to cover your living expenses for a year.
- Get in Shape
Medicare Part B premiums are set to go up by 9.7%, along with other associated healthcare costs. Not only should you invest in getting in shape now to reduce future healthcare costs, but it’s also essential for enjoying your retirement to its fullest. The hardest part about getting in shape is starting, so use the fact that you still have an income and work benefits to hire a personal trainer and to find the exercise routine that you enjoy the most.
- Invest in Passive Incomes
The last tip to prepare for your retirement is to invest in passive income stream options. This could be a digital course you sell that cumulates all your knowledge. Alternatively, you could set up workflows to monetize your hobbies after you retire. Rather than relying on them to support you, you can enjoy making what you do, and selling or going to markets as a positive-income pastime.
