The age-old question when the idea of retirement arises is: how much money will I need? The process of estimating expenses and identifying sources of potential income is therefore imperative in the early consideration stages of retirement. Here are some essential aspects to consider when preparing a financial retirement plan.
Set A Goal and A Plan To Achieve It
The first step within the process is to establish a clear road map that addresses the question: what kind of lifestyle do you want to lead during retirement? This road map will eventually lead to an ideal sum of money you would like to retire on and may require the assistance of a financial planner to correctly estimate.
Once a goal has been established, utilise the services of either a financial advisor or a retirement calculator to understand how much money you will need to put aside to reach this figure. This amount can be altered and may shift due to factors of age, disruptions in employment or assumptions on expected future income.
The sooner you start saving to retire, the better. Essentially, to save successfully, you need to earn more and cut on spending. Once you begin the saving process, be sure to regularly track your progress to ensure you are staying on course for your financial goal.
It is also important to put away select funds for any unexpected occurrences or roadblocks whilst simultaneously saving for retirement.
Explore Alternative Ways to Make Money
Whilst saving money (and therefore cutting back on everyday spending), it is possible to increase your income through alternative means. Turning your hobby into a small, side business is one example – and could provide some immediate income for a small amount of labour or stress on your part. It is therefore a great idea to identify things you are good at or have an interest in that could easily be monetized.
Pay Off Your Debts
Taking financial steps to reduce and manage debt ahead of retirement is an excellent idea. By working debt into your pre-retirement plan, extreme financial stress will be alleviated, and remaining funds will go towards your saving plan.
Invest and Review Your Insurance Policy
As you mature, your insurance-based needs will change drastically. It is therefore recommended to review your insurance plan and needs with a financial advisor before progressing with your retirement plan. This is a great way to eliminate any unnecessary fees associated with insurance and may provide additional income to greatly benefit your savings plan.
Though it may seem daunting, these aspects of financial decisions and planning are more achievable than ever with the assistance of advisors, consultants or even staff at lifestyle villages across the country. Champion Lakes is one of one of WA’s premium retirement village. Our village is uniquely designed for over 55s who seek an active, social and secure retirement. For enquiries, please contact us at (08) 9390 3909.