April 3, 2017, 9:35 am

You May Be Ready but Have You Prepared for Retirement?

by: The Financial Blogger    Category: Financial Planning,My Plan to Retirement
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In the USA the figures don’t make good reading. Many citizens are carrying credit card debt that incurs a high rate of interest. Too few have sufficient in their retirement fund and seem to think that Social Security will make a significant contribution to comfortable retirement. The latter is simply untrue; it was never designed for that and the System is increasingly under pressure as the fund is dwindling. Don’t expect the Republican Party to increase taxes any time soon to boost it. You need to be saving and one thing that you can do immediately to help if you have credit card debt is to borrow ironically. A personal loan can pay off that balance and the interest you will be paying is significantly lower.

You deserve a comfortable retirement after a long working life but you have to earn that as well. The sooner you start to save, the more chance you have of success. If your dreams of traveling, fishing and spending time with the grandchildren, you will need money and after the regular monthly paycheck stops, you must know where the finance is coming from. Today’s population that is approaching retirement has begun to understand the problem. According to a recent survey by Transamerica Center for Retirement Studies almost half fears that its investment is insufficient.

 

Things for Serious Consideration

Here are a few things to consider when you are thinking about retirement:

  • You can draw Social Security as early as 62 but you will receive significantly less per month than if you wait until full retirement age, 66 and rising to 67. If you can wait until you are 70 there is more again.
  • You should not be carrying any significant debt if you are considering retirement. Some as normal as a credit card balance will be a problem because of the interest you will be charged.
  • Hopefully all your children will now be financially independent. That means they are working and in control of their own finances, including the repaying of their student loans direct lenders where applicable.
  • If you are helping to support elderly parents then it may be you need to delay the decision to retire.
  • You certainly must sit down and work out a realistic budget. If you have lived by one throughout your life there is nothing that should cause you too much concern. However, if you have found that over the years you have been spending virtually all your monthly paycheck to cover your bills, you should reflect that on retirement, your paycheck stops.
  • Those of you that have had an investment portfolio and can afford to maintain one after retirement should look at whether you have too much risk in that portfolio. The recession hit many portfolios but although the recession has gone, there are some economic indicators that suggest there is no boom on the horizon even if Donald Trump suggests he can get the country moving ahead. If you have any concerns, you should talk to a financial advisor and address those concerns.
  • Retirement affects more than just yourself. There may be wife, children and even elderly parents. You should certainly discuss everything with your wife to reach the best possible answer to your circumstances. If you are both working then you may decide that one of you retires immediately and the other continues for a while. It is a matter of doing the calculations.

So What Do You Think?

After looking at each of these aspects, you may be closer to reaching a decision on retirement. You need to consider how you will spend your time, bearing in mind you will need to be able to finance those activities. If you have many friends who have retired that is a different position than if your friends are mostly working. One thing is certain; there are too many Americans today who have not got the luxury to retire early with plenty of money to enjoy the dreams they had when they were younger. If this is you and retirement is still some years away, act now, reduce any debts you have and start to save.

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