What does a happy, satisfying retirement mean to you? Does it mean switching from full-time work to part-time work or does it mean not working at all but spending more time with the people you love and doing more of the things you enjoy?
When you ask this question sooner rather than later, then you will have more choices because you’ll have money-wise retirement.
With that in mind, here are 4 steps to getting financially organized for retirement:
Anticipate Funeral Costs.
Let’s start with the end in mind. If you organize your finances properly, you will have taken steps to relieve your family of the high cost of your funeral expenses. These can range between $7,000 to $10,000 for burial home services, a cemetery burial, and a headstone installation. One way to manage these costs well ahead of time is to get final expense insurance. There are many nonprofit organizations that help with funeral costs, you can learn more here.
The first step is to meet with an insurance agent to walk you through the different final expense insurance plans. Companies like policy Zip can assist you with this. Once you’ve found a plan that suits you, enroll in it, and assign a beneficiary; then either give a copy of this insurance policy to the beneficiary or record the number in your estate planning documents.
Evaluate Your Assets
Take stock of your assets. How much do you earn at the end of the month after taxes? How much do you need to keep in your bank account to keep on top of your bills? How much can you put toward your retirement account? Also, consider any other income sources and material possessions that you can liquidate. A wealth advisor can help at this stage as they will be able to consider your assets and your aims and then build an integrated retirement plan that incorporates all your retirement assets.
Besides evaluating your financial situation, think of potential assets related to your talents. These are hobbies that you could monetize when you retire. Perhaps you could tutor math or teach piano; or, perhaps you love to write and could turn that into a publishing career. Apart from helping with cash flow, it will be enjoyable sharing your talents with others.
Decide When to Claim Social Security Benefits
When you collect your social security benefits will make a huge difference. The longer you wait, the greater the benefits you and your family will receive–because waiting to claim will make you eligible for delayed retirement credits. Your benefits will increase until age 70. Use this Social Security Benefits Calculator to help you decide when you should claim your social security.
Learn How to Budget
Now is the best time to start learning how to budget your money. Besides giving you the skills you need when you retire, it will also help you squirrel away any surplus income you now and put it into your savings account.
Here are some questions to consider when planning your budget:
- What is the best software budget program I can use to keep track of my income and expenses over the next few months to get a better idea of how much money is coming in and how much is going out?
- What are my financial goals for retirement?
- How much debt do I have and at what rate can I pay it off?
- How much money can I save each month if I cut some of my expenses?
- What investments do I currently have or that I can start when I have enough money saved up?
In conclusion, by thinking of your retirement ahead of time, you’ll enjoy peace of mind, knowing that you’ve taken care of your financial future. By planning for your retirement, you’ll be able to do wonderful things like spending more time with the grand kids, traveling, or pursuing a favorite hobby.