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Most articles on financial planning for retirement assume you have been able to collect a million or two during your working years to supplement your Social Security check during retirement. But if you haven’t saved that much, you can still take actions that will help to ensure your golden years are comfortable and enjoyable. Here are a few recommended measures you can take to secure your financial stability for the retirement years.
Save as Much as Possible
Hopefully, you have had a 401K plan or IRA that you have contributed to over the years that will provide funds for your retirement. If your employer matches your contribution in part or whole, take advantage of this free money to help you live more comfortably in your non-working years. Automatic savings deposit accounts or mutual funds can help you to save money without lifting a finger. These plans can be an easy way to save additional money for your retirement years.
Eliminate Your Debt
If you have an auto loan or line of credit on your home, pay the outstanding balance down as quickly as possible, so you don’t have the loan repayment and interest as a recurring expense. Instead of taking on more debt at this time in your life, consider a previously owned vehicle, a less lavish vacation, or a smaller home remodeling project.
Develop Passive Income Streams
Passive income is money you don’t have to work for on a daily basis. It includes rental income and other types of monetary compensation that occur without active measures to earn it. If you have significant savings, you might consider purchasing a property to rent out to others. You could also rent out your vacation property, on such sites as Airbnb. If you have a parking space available on your property, others might wish to rent the space. Other passive income streams include blogging for affiliate advertising or influencing for merchandise on social media. These all can be used to supplement your income during retirement.
Cut Your Expenses
Household expenses tend to grow in the natural course of events. Prices increases and inflation expand the amount of income you spend on necessities and luxuries alike. Take a look at the amount you spend on each item every month. You may be able to find plans and packages that save money on your monthly bill. Cut down on entertainment expenses, and find a supermarket that offers lower prices. An electricity plan that spreads energy costs throughout the year can be helpful. Instead of keeping two vehicles, sell one and rely on Uber or public transportation to contain costs. These small adjustments can help you to save money that you can use elsewhere.
Downsize Your Housing
Staying in the family home has been a preferred option for many people in their retirement, but this may not be the best choice financially. Your home may be too large for your needs or may be older and require significant upkeep that will drain your retirement funds. A smaller home, a condominium with no maintenance, or an apartment may be the better choice for you. More compact housing can be particularly important if you have medical issues or prefer to spend your time on clubs, hobbies, or other activities.
Preparing for retirement requires research, thought and specific actions to ready your life for this significant change of circumstances. If you consider your immediate needs and those in the future, you can make good decisions regarding your finances during retirement. Implement these tips, and you can improve your financial security to engage in the activities you most enjoy.