A fulfilling, happy, and successful retirement can mean different things to different people. For many, it can mean transitioning from a full-time career to spending more quality time with friends and loved ones. For others, it can mean playing golf more regularly or starting a garden.
If it's any consolation, once you can figure out what you want to do, retirement planning should come easy. To ensure you get to enjoy retirement success, keep the following tips in mind:
Plan for Longevity
Undoubtedly, living to age 100 is still quite impressive. However, it is no longer as uncommon as before. Nowadays, people live healthier lifestyles and have more access to breakthrough medical treatments, allowing them to live longer than before.
When planning your retirement, you must consider life expectancies. In other words, you (and your assets) should be prepared to live longer. This is especially important if you are active, in excellent health, and have longevity in the family history.
Stay Out of Debt
While debt can be a concern at any stage in your life, it can be particularly challenging to deal with post-retirement when your assets, pensions, and Social Security are more fixed. That said, it is recommended that you pay for things as you go.
It is also ideal that you set aside assets and income for substantial expenses. It would also be best to pay off your credit card dues in full each month. In addition, avoid using your home equity line to finance projects.
Have Sufficient Preservation Assets
For many, retirement involves preparing assets to replace a part of the paycheck. This means liquidity and security are needed to warrant you get paid, regardless of market performance.
Aim to have at least ten years of cash need in preservation assets like high-quality bonds and cash. This can help ensure you can easily ride out market downturns and still have the ability to pay your bills.
Be a Committed Long-Term Investor
For many, asset growth is needed to sustain retirement goals over decades. Stock investments are often used to achieve investment growth. However, you must keep in mind that markets can be cyclical, so it would be best not to overreact to market events or chase returns.
Many studies have shown that committed and disciplined investors will win if they invest and allow their assets to recover. Having preservation assets will help you to be able to sustain your needs even during challenging market segments.
Consider "What If" Scenarios
When preparing for retirement, you need to realize that life is a winding journey. Since you can't foresee all the twists and turns, you should evaluate your financial and personal security by considering a few "what if" scenarios.
What scenarios you should think about should include spending variations, care needs, differing rates of return, etc. Examining possible future outcomes can help you make better financial decisions today to be better prepared for tomorrow.
Invest in Long Term Care (LTC) Insurance
One of the most significant retirement risks is the likelihood of needing ongoing care due to cognitive or physical limitations. While you can always hope you won't need care, your retirement requirement can get compromised if you are not prepared.
Unfortunately, care costs are rising rapidly, and annual care costs have become quite costly for many. Thankfully, you have the option to get Long Term Insurance to fund future care costs.
Preparing for a successful retirement is no easy feat. That said, keep the tips laid out above in mind during the planning stage, so you are a step closer to enjoying that successful retirement you have always wanted.
About the Author:
Rachael Harper is the Content Marketing Strategist of Bennett & Porter, a wealth management and insurance firm based in Scottsdale, Arizona. When not writing, she makes use of her time reading books and playing bowling with her family and friends.
Photo: L-R Elaine Murray DMFLF Educator, Derby Chukwudi DMFLF Advisor, Jacqueline Nyers DMFLF Educator
On July 26, 2021, DoughMain Financial Literacy Foundation, Princeton NJ, Visions and Pathways, Bridgewater, NJ and Kevin Whelan from NJ CASA joined forces in support of our collective missions to help at-risk youth develop personal finance skills by offering a FitKit Personal Finance workshop. The workshop, underwritten by cashflownavigator.com introduced important life and personal finance skills to a group of at-risk youth age 16-21 involved in the Visions and Pathways Transitions to Adulthood Program. By offering this workshop we hope to have provided some basic skills as food for thought as young men and women transition from dependence and foster care, to independence.
DoughMain Financial Literacy Foundation's (DMFLF) mission is to prepare today’s students for a lifetime of financial responsibility through engaging programs delivered to schools and communities. Through our FitKit student-centered multi-sensory financial literacy curriculum designed by a team of highly skilled educators, DMFLF is working to close the financial literacy gap while helping to educate, empower and help at-risk youth overcome life’s challenges
About Visions and Pathways
Visions and Pathway's mission is to provide abused, neglected, and homeless youth with housing, a stable environment, and supportive services that guide them in becoming self-sufficient. Visions and Pathways has helped abused, neglected, homeless, missing, and at-risk youth since 1970 by providing; food, housing, counseling, education assistance, arts and recreation activities, career and employment counseling, scholarships, and financial literacy instruction.
Cashflownavigator.com’s mission is to help its members understand, measure and manage their total financial situation and to set goals that move them closer to financial independence.
We will be inviting a select group of potential funders who express interest in learning more about the work of DoughMain Financial Literacy Foundation to observe the demo workshop.
With your support, we can make our mutual objectives become a reality for all at-risk young adults, improving financial literacy, ending financial victimization, and giving our youth a fair chance.