When will you retire?

in Lifestyle,Money

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KAA-Boomers can have their retirement cake and eat it too—by taking some simple pre-retirement steps now to ensure a problem-free future.

If you’ve made the decision to retire at a set age, congratulations! You’re preparing to join millions of people who have said goodbye to the daily grind for a life of relaxation, low stress and enjoyment. Or, have you?

If you are not fully prepared for your retirement, you could run into big trouble down the road. Rather than spending your new-found leisure time enjoying travel, and hobbies you could very well find yourself pinching pennies and trying to decide whether to pay for food or heating bills.

Fortunately, there are some pre-retirement steps you can take to help make certain your future is rosy. With the right planning, there is a very good chance you can have your cake and eat it too. It is possible your set date might be a little premature, but only you can make the decision based on personal finances, needs and goals.

Timing Is Everything

While there are certainly circumstances that demand retiring early, this is not always the case. Many people find if they work a little bit longer, they can better prepare. There are some very compelling reasons to sit down and really map out retirement when it is possible. Some of the best reasons to look before you leap include:

  • Making sure financing is adequate. If you don’t really have your ducks in a row, you might find yourself without the money necessary for all the exciting activities you have planned. In fact, many find themselves hard-pressed to pay for basic living costs. With people living longer and longer lives, retirement can easily span 30 years. Not planning for this can be a painful mistake.
  • Having a handle on retirement activities. The prospect of decades without having to face the rigours of a workday life can sound very tempting. Unfortunately, many people dive into retirement and find themselves rather bored with the prospect. While having a demanding lineup of activities is not necessary, many retirees find they feel better – emotionally and physically – when they have a reasonable outlook on how they will spend their time.

There is more to retirement than picking an age and, a date and bidding former co-workers adieu. It is best to carefully plan out the transition financially and emotionally before moving forward.

Making It Happen

While there are some potential pitfalls with retiring too early, many people find they can pull it off comfortably. To make sure you have selected the right time to enter this exciting chapter of life, the things you need to carefully consider and plan for include:

  • Personal goals. Decide what you intend to do with your life in retirement and check retirement financing to see if it is feasible. Use a retirement calculator to help out.
  • Personal financing. This is key to making the decision to retire for many. Government plans, such as the Canada Pension Plan, simply are not enough for a retiree to live comfortably on. They can, however, boost other retirement plans, such as company pensions.
  • Inflation concerns. It is important to remember that the $50,000 a year you can plan on in retirement might not go very far 10 or 20 years down the road. Consider an average of a 3 percent increase in the cost of living when planning your retirement budget. Do you have the financing to cover the gap?

Before making the final decision to put in a resignation letter at a set age, take a very close look at the financial plans you have in place. If at all possible, use a retirement calculator or consult a financial expert to see the full picture of retiring at your desired age versus waiting a few years.

Tips And Tools To Help You Along The Way

If you have it in your heart to retire at a particular age, there are things you can do to make the dream reality. The earlier you start planning and preparing, the better. Some of the things you can do in advance include:

  • A financial review. Carefully look at all retirement financing well in advance of the date and see what can be done to bolster it, if necessary. It is never too early to start considering retirement planning. In fact, many experts recommend starting in the 30s or 40s.
  • Bill review. Take a look at all existing financial obligations and see which ones you can rid yourself of prior to retirement. Credit cards, car payments and even a mortgage can sometimes be paid off in advance.
  • Advanced corner cutting. If you really want to put some extra pennies away prior to the big day, take a look at all the corners that can be cut in the present to put money into investments or savings. Very little things like lunches out or buying name brand items instead of store brand can add up to a lot over the course of a few years. The more corners that are cut the better.

If you have made the decision to retire, you’ll soon find out that this step is an incredibly large one. With careful review, planning and preparation, you can make it happen. Make the most of your final working years to prepare yourself for an incredible experience.

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