Your retirement years may have been a long way to go. But, it does not mean that you will not plan for it. Retirement is a special time in the life of any person and these days we have websites that have beautiful retirement wishes that can help you to express your feelings in the best possible way for your loved one who is about to retire. But when it comes to your own retirement, there is so much you need to plan for. However, planning for your retirement may seem to be overwhelming if you never have done it before, but, it does not have to be. We provided a checklist of the things that you need to do to have a successful retirement.
Table of Contents
Estimate your retirement budget
One of the goals of retirement is to be able to sustain the current lifestyle that you have. With this, you must determine all your expenses, how you want to spend your retirement years, and the trend of the inflation rate. You can use a retirement calculator to project how much you will be needing by the time you retire.
Create a retirement plan timeline
Just like any other financial goal, your retirement should have a concrete plan since we are talking about your future. Hence, you must create a retirement plan. Your retirement plan must include your targeted amount, the timeline you will be following, and the targeted date when you will be needing this fund. Plus, you can note all your generated income. Creating this plan will keep you motivated and on track on your retirement goal.
Pay off your debts
Your retirement years should be free from any financial responsibilities since this is the time that you should be enjoying the fruit of your labor. With this, you must pay off your debts as soon as you can to avoid accumulating interests.
Build your emergency fund
Funding for an emergency fund is one of the essential things you must do to establish your finances. The ideal amount of your emergency fund is between 3 months to 6 months of expenses.
Do not forget your savings
Even though you are planning your retirement, do not forget to allow the amount for your savings. Allot 10-15% of your monthly salary to your savings. You can also open a bank account for your savings so you won’t have a chance to spend this money.
Make time for investment
Apart from building up your emergency fund and savings, it is also important to make your money grow. With this, make time to invest your money that will help you achieve financial stability and can deliver consistent retirement income to you.
You can choose from bonds, stocks, UITF, or real estate. Each investment avenues have its own fair share of pros and cons. It is best to learn each one and weigh which investment tool is aligned with your budget and financial goal.
Plan for property purchase
The best time to purchase your first home is when you do not have your own family yet. If you do not have any cash on hand or your budget is not enough, you can opt to apply for a home loan. The earlier you purchase your house, the better. So, by the time of your retirement, the monthly amortization of your house will be done.
Retirement may sound too early for some, especially for the millennials. But, many financial experts recommend to plan and start it as early as possible. Start putting up your retirement fund by following this financial checklist.