FAQS
What steps should be taken in retirement planning?
Retirement planning isn’t a one-time thing, so you will want to revisit these steps as you go. You may not need to think about them every year, but you should look at your strategy every five to six years to see if you’re on the right track. This lets you adjust your plan to fit your current lifestyle.
To make a retirement plan, you need to decide how and when you want to retire. If you want to retire early, you may need to be more aggressive in your savings and investments. If you’re closer to retirement, you may need to consider how much you have saved and whether you can put off retirement for a few years to set more money aside.
What are your financial goals?
Retirement is probably not your only goal right now. You might be saving toward a home or trying to build your emergency fund or a kid’s college fund. It’s important to think about how much you can realistically put toward your retirement, not just based on your age and how much you want to have in retirement, but to also look at where you are now and where your finances need to go.
What options do you have for saving for retirement?
Retirement planning includes knowing where to put your money. If you have the option of a 401k employer match, that is a really good place to start, because it’s not just your money being saved for retirement. A professional retirement planner can help you find the best options for your situation so you get the best tax advantages and can strategize how to invest your money.
How do you select the best retirement investments?
Stocks, bonds, mutual funds, IRAs and 401ks are just a few of the options for retirement. You need to take into account your stage in life, your retirement goals, and the amount you have to invest to decide what investments fit into your retirement plan. You can also decide how to deal with the ups and downs of the market as your nest egg grows. A professional financial advisor can help you hedge your bets and find the investments that fit your needs.
When should I start planning for retirement?
We believe that everyone should start thinking about retirement as soon as they enter the workforce. Ideally, in your 20s, but especially in your 30s and 40s. The more time your money has to grow, the more you have when you retire. But even if you’re a little older, you shouldn’t count yourself out. Any money you can put toward retirement, the less stressed you’ll be.
What should I do 5 years before retirement?
Many people realize that it’s better to start transitioning into retirement than just abruptly leaving the workforce. Five years out, you should start looking at your investments and figuring out what your income will be when you retire. You may also want to practice living on that amount now, to see if you can make it work. If you want to make any large purchases or renovate your home, it’s better to plan now while you’re working for those expenses.
