5 Ways to Save for Retirement

Everybody dreams of retiring in their 60s and enjoying all the things they’ve put off for the last few decades. Unfortunately, the reality is that it takes a lot of planning to be able to retire at all, and many people never get that chance. If spending your days away from the office and in the sunshine is important to you, check out these tips to save for retirement now.

1. Get the Most Out of Your 401(k)

If one of the perks of your job is access to a 401(k) plan, now is the time to begin using it. These plans allow you to add money to your retirement savings prior to paying taxes while Roth 401(k)s add money after taxes. Either way, saving money now helps to set you up for the future. Some employers match the money you add to your 401(k) up to a certain percentage, so do your best to max out that benefit. While it may give you a bit less to work with now, the free money from your employer will be helpful in the future.

2. Purchase Items at a Discount

Whether it’s the grocery store or a new television, avoid going to the store and purchasing the first thing that catches your eye. Compare prices, look for coupons, and wait until things go on sale to purchase them. Add the money you saved to your retirement savings. For example, if you normally spend $150 per week on groceries but you save $40 at the store one week, that’s $40 more in your savings, or $2080 if you do so every week for a year.

3. Save Those Credit Card Rewards

Does your credit or debit card offer a cash back percentage for certain purchases? If you spend $2000 per month on qualifying purchases and get 1 percent cash back, that’s an extra $20 per month. Rather than spend it on something you don’t need now, add it to your retirement savings. Doing so every month for a decade will give you another $2400. It may not seem like much, but when you are literally spending money to make money, it’s definitely one of the easiest ways to save.

4. Rent Out Your Space

Whether you have a spare room, a pool house, or an entire rental property, consider renting it out using a service like Airbnb and banking all that money for retirement. The platform, which has become quite popular in recent years, ensures your safety by allowing you to choose who stays in your space, decide when you are available, and determine how much you will charge. The average room costs more than $150 per night, and you can charge even more if you live in a popular area or during major events. Even renting a room out just once per week would bring in about $7000 per year.

5. Purchase Life Insurance Now

One of the biggest reasons people can’t retire when they’re older is because someone else in the family — usually a spouse — passes away without life insurance. Even the most affordable, impersonal funeral service costs thousands of dollars, leaving the family on the hook if there was no life insurance policy to cover the costs. Purchasing insurance now helps you to invest in your future. Some policies can even be used as retirement funds by allowing you to borrow against the amount of the policy. However, keep in mind that doing this leaves less money if something happens down the line.

Regardless of how you decide to spend your retirement, there is no denying that you must save. Even if you love your job and can never imagine yourself spending your afternoons on beaches or golf courses, there will likely come a day when you can no longer work. Saving money now ensures you won’t be met with stress when that day comes.

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4 Vital Retirement Tips That’ll Turbo Boost Baby Boomers’ Retirement Finances

Baby Boomers could very well be the generation that has worked the hardest in their professional careers. However, despite this, many Boomers have not  been able to save enough to enjoy a relaxing retirement. There is in fact a high percentage of Baby Boomers struggling with financial issues.  Many of these they will not be able to sort out before they retirement.

Many independent studies have been done on the Baby Boomers retirement situation and concluded that about 1/5th of Baby Boomers might be forced to retire before they have paid off their mortgages, while others will not have enough funds for retirement for other reasons.

But, do not worry yet. Here, we have jotted down some vital tips that can help Baby Boomers augment their retirement savings and improve their current retirement situation.

It’s Time To Re-evaluate Your Assets for Retirement

Considering the fact that you are moving ahead towards retirement and old age, NOW is the right time to evaluate your home. You might not need nor be able to maintain a big house.

So, if you own a big house that exceeds your needs and you are still making mortgage payments on it, it could be better to downsize to something smaller and with no mortgage.

Don’t Invest Aggressively To Make Up For The Lost Time

What’s gone is gone. You cannot get that time back. But, at the same time, if you think that you can make up for the lost time by aggressively investing in some tempting stocks or other entities, you would likewise be wrong. Do not make risky investments as that would be your second terrible mistake.

Undoubtedly, an all-stock portfolio is better than others.  But, you may not be able to manage the ups and downs that come with it. So, even if you are planning to invest, its better to play it safe.  Don’t risk your wealth on anything that is too uncertain.

Reconsider Your Insurance

Whether it’s your life, car, or home insurance, it is now the right time to reconsider all your insurance policies. There are some lucrative policies for people above 50. You can choose one of these policies to sell for cash right now. Also, if your children are included in your policies, you may wish to discontinue sell those.

Your children are grown-up. They can take care of themselves.  This frees you up to sell your policies that will prove to be extremely supportive in your retirement years.

Work On Enhancing Your Health Care Savings and Opt For Real “Good” Healthcare Plans

As medical costs continue to increase at an accelerated pace, this is one of the expenses which cannot be avoided. Itis better to start planning for your health care plans today. Look for health savings accounts which offer tax benefits and also look for the best health care plans with maximum benefits but low premiums that you can find. But, above all, the industry experts reckon that Baby Boomers need the right financial advice to ensure that they get the best in their retirement years. If you are a Baby Boomer struggling with retirement issues, check out this URL that can help you understand your current situation and take the right steps moving forward- https://www.masonfinance.com/blog/baby-boomer-retirement-infographic/

Here’s an infographic that displays in pictures the underlying facts of the challenges Baby Boomers face in retirement.

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

Why FIRE Never Would Have Worked In The Past

The latest buzzword in the personal finance community is FIRE.  Many of the most successful blogs now talk about FIRE.  For those that don’t know, FIRE stands for Financial Independence, Retire Early.  The blogging community now has many blogs where people achieve financial freedom at a young age, and can retire well before traditional retirement age.  Many boast of retiring in their 30’s.

This is a pretty cool movement, especially in the age where Millennials are breaking many of the molds created over years past.

I started thinking about it.  I came to the conclusion that FIRE probably wouldn’t have been embraced by generations past.

Here’s my take on what I think generational mindsets are regarding FIRE.

Millennials (born 1980-2000s)

I think that millennials are the heart of the FIRE movement.  Many don’t want the traditional life that they witnessed grown up.  This stands to reason that many millennials are at the heart of the FIRE movement.

Generation X (born 1965-1979)

This is probably the dividing line between acceptance of FIRE and skepticism.  Many in our generation have gone through enough recessions that we know things can change.  We’ve seen good times and bad.  The idea of FIRE sounds great, but many may see it as ‘too good to be true’.

Others in our generation still fall in the mindset that each generation should strive to be more successful than that prior.  This has been pretty hard for our generation.  There’s a lot more competition in the job market.  We’re the first generation that saw most of our parents get a pension, but very few of us will.  We have healthcare costs that previous generations did not.  For many in our generation, just trying to keep up with our parents is hard enough. Adding in the goal of early retirement can seem even further out of reach.

Baby Boomers (born 1946-1964)

The baby boomer generation was fueled by consumerism and prosperity.  A lot of wealth was built by boomers.  While making money wasn’t ‘easy’, boomers who worked hard found money flowed in.  For many boomers, making money and achieving wealth was the goal.  The big one.

Simply put, I think many boomers would have asked why they would give up making money when there was money to still be made?

Greatest & Silent Generations (born 1910-1945)

These generations were both impacted by the Great Depression.  Because of this, FIRE would simply not have made any sense to them.  Many here saw what it was like to struggle.  To have nothing.  Many people immigrated and started with nothing.  The idea of retiring early would have been unheard of.  For many in these generations, not having enough money was a giant fear.  Even if they had enough, there was always the fear of what could happen.  Why? Because many here had seen what could happen.

I think many in this generation would have been scornful of FIRE.  To people in this generation, if you were able bodied, you worked.  That’s just the way it was.

The Late 19th Century

In the late 19th century, everything was changing.  Machines were making things easier and creating worldwide growth. Cities and population centers were exploding.  There was so much to do that everybody had to pitch in.  The demands of the world were plentiful, and everybody was expected to pitch in.

I think in this era, anybody who would have attempted FIRE would have been laughed out of whatever town they lived in.

Tribal Days (Going Way Back)

Hundreds of years ago, when we lived in tribes, everybody contributed.  Many tribes expected every person to contribute.  If you couldn’t, many tribes expelled you.  Or worse.  There would have been no FIRE here.  If you had tried to stop working, the tribe would have taken what you have, and sent you away (or thrown you off a bridge).

Kind of makes working seem like a pretty good alternative, no?

FIRE Across The Generations

There’s my take on the generational acceptance of FIRE.  I think that FIRE is a big thing because it truly is a new concept for many.

What do you think of my thoughts? Do you agree on how prior generations would have looked upon FIRE?  What generation are you and what do you think of FIRE?  Let me know in the comments below.

 

 

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

9 Money Goals Everyone Should Have

Rich or poor, working or retired, blue collar or white collar.  None of those things or any other will get around the simple fact that money is important.  As such, there are certain things that everybody should do with their money.  These don’t mean that everybody should approach money the same way.  It just means that in some fashion, each of the below items should be on everyone’s list of money goals.

Have A Rewarding Career

Don’t hate your job.  It’s just not worth it. You don’t have to love every minute of the day that you’re at work.  That’s just not reasonable.

But you should enjoy what you do.  You should feel that you’re making a difference.

Make Your Job About More Than Money

Money is great, but it’s not everything.  You want to have enough to pay the bills and enjoy life, but always look at the trade offs.  If you’re missing your kids grow up or losing your friends on account of your job, reconsider your priorities.

Money is a means to an end.  Treat your career accordingly.

Have A Fallback Plan For Your Income

Your job may seem like the most secure thing in the world.  It might not be tomorrow.  You might love your job more than anything.  That could change in an instant.

Always have an idea of what you could do next.

For some this could be another position or a contract job.  For others, maybe you have a side hustle that you could do full time.

Whatever the case, be prepared.

Save Money

Whether you’re just starting off and on an entry level salary or you’re rolling in it, save money.  It’s important.  Even if you’re paying off debt, save money.  It’s a cushion to fall back on that everybody needs.

Budget And Track Your Money

Do you know where your money goes? Do you know where you want it to go?  You should be able to say yes to both of these questions.

Now, you might not want to track down to the level of every dollar.  Or maybe you do.  Whatever your style is, you need to do both of these things for money success.

Understand Your Investments

If you invest on your own or through a 401(k), it’s important to know what you’re investments entail.  Even if you have an adviser, you need to know where they’re putting your money.

This won’t guarantee you will never lose money, but chances are, if you understand where your money is, you’ll end up with more of it than someone who doesn’t.

Be Well Insured

If you drive, you need auto insurance.  A homeowner? You need insurance on your property.  What if you rent?  You need insurance on your property.  If you have family that counts on your income, life insurance is key.

Understand the different types of insurance and know what you need.  Make sure it’s current.  Your needs today might be different than tomorrow.

Look over your policies and your needs at least once a year.  As part of that, bid out your insurance to see if you can find a better price.  This is one area that changes often.

Know Your Credit Like You Know Your Family

Your credit is the basis for almost anything you do with money.  You can’t get loans without good credit. You can’t pay your bills if you have too much credit.  Some employers won’t hire you if you have bad credit.

The bottom line is that you need to know your credit.  Know what you owe.   Know your score and what it means.  Keep track of such things regularly.

It’s one of the most important things you can do for your money.

Have Vision

What’s the use of money if you don’t have a plan for what to do with it?  Of course you have your needs today that must be accounted for.  But also know what it’s there for long term.  Plan.  Have a vision for what your money will be doing for you down the road.

These are some items I think are of utmost important for anybody that thinks money is important.  That’s you, right?

Readers, what do you think of this list?  What are some of your personal money goals that might not be on this list?  

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.