5 Reasons To Start Planning Your Retirement Now

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Many people ask when they should start saving for retirement, and the simple answer is: When you get a job. It is absolutely never too early to start putting away a little at a time.

Whenever you start saving, be sure to avoid withdrawals unless absolutely necessary. You can choose to self-fund your retirement or you can contribute to your employer’s retirement plan. Research investment options and choose the one that makes the most sense for your situation.

Inflation

Simply put, if you are preparing for retirement, you cannot forget to factor inflation into the mix. Inflation is the rise of prices for goods and services over time. Therefore, you can save $100,000 and inflation will not affect the amount you have saved; however, it will affect your purchasing power—meaning the amount you can buy with that amount of money. Inflation can deplete your budget and saving accounts fast. Speak with a financial advisor to see how much inflation you should add to your plan.

Medical bills

While no one hopes to have a medical emergency late in life, it is best to prepare for the what-ifs. Even with health insurance, there may still be a need to pay out of pocket. Saving in advance can help you prepare for these possibilities without the added stress.

Unplanned early retirement

There are many reasons why someone would retire unexpectedly; including career layoffs, failed businesses, and disabilities. Since life is full of unknowns, saving for retirement early can help you to avoid a personal finance crisis late in life.

Bad investments

Maybe you started planning for retirement and make some investments that you thought would pay out in the long term. Perhaps you put most of your money into investing in a company or property that did not yield the ROI (return-on-investment) that you anticipated. This is why it is important to not only start saving early on, but also to make sure you have a well balanced investment portfolio.

Earn higher dividends

Preparing for retirement early can lead to higher dividends, or interest, accrued over time. Make your money work for you by speaking with an investment advisor to see what investment accounts work for you. If you start saving early, you could double the amount you have at the time of retirement.

What are you doing to prepare for retirement? Do you think retirement will look differently in the next 20 years? Let us know your thoughts.

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A Millennial’s Guide to Finances

pablo-12Millennials are hard at work making a name for themselves in business, fashion, and lifestyle. Their financial futures look bright due to endless opportunities and their zest for innovation, but are they making the right financial decisions? There are a few topics that are important, but do not get the attention they deserve.

Make your student loan debt a priority

Most millennials are either heading into college or have completed their degrees in the past few years. Kudos if you have completed your degree, way to stay focused and take charge of your future! What you may realize now, is that student loan debt follows you around long after you walk the stage. Looking for ways to lower your student loan debt? Start by evaluating all of your debt, lower your car payment, negotiate for lower insurance premiums, and focus on paying off one bill at a time.

Stop using your credit card

Credit cards can be tempting to use when you want to make a large purchase, but don’t quite have the funds in your account to cover it in cash. Avoid the temptation to buy something outside of your means and you could be well on your way to a debt- and stress-free life.

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Talk about money before marriage

Finding the right person to spend your life with is a process that can take some people years to accomplish. With divorce rates increasing a little each year, it is recommended to discuss finances before heading to the altar. Discussing finances can lead to a healthier relationship and clear expectations for the newlyweds.

Wondering which questions to ask your beau? Here are a few conversation starters:

  • Do you have debt?
  • How much debt do you have?
  • Do you have a savings account?
  • How do you feel about spending money on leisure, entertainment, and unnecessary items?
  • Do you follow a budget?
  • What are your financial goals?

Contribute to your 401k

Maybe you don’t plan on retiring anytime soon or perhaps you own your own business. Whether it is a 401k, mutual fund, or a savings account, millennials must start saving money now in order to prepare for the inflation that is sure to shake our financial market before they reach retirement ages. To get an idea of how much you will need to have a relaxing retirement, check out this calculator.

You aren’t too young to invest

Investing early allows time for your money to earn significant interest by the time you are ready for retirement. If you aren’t interested in the stock market, consider investing in a business or real estate. You are never too young to make your money work harder for you. By 50, you will appreciate the effort you put in at this age.

If you’re a millennial, tell us how you are taking control of your finances!

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7 Tricks To Help You Travel More this Year

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If you have never had a travel savings account before, it can seem a little off. However, this account will ensure that you are taking at least one trip every year. You can contribute as much as possible, starting with $50/month, you should be able to plan a long weekend getaway by the end of the year.

Plan ahead

Do you have a certain destination in mind? Calculate and monitor flight and hotel prices so that you know how much money you need to save. Planning your trip 6–12 months in advance can help to establish potential flight and hotel costs and will give you time to make final decisions.

Travel in groups

Plan a trip with 2–3 of your closest friends and their families if you are looking for a family getaway. Many times you can rent a condo or a large space for much lower than the price of a hotel. The perk of having people with you? Simple, the price is split between all of you, making the trip more affordable.

Research peak seasons

Peak seasons are times when a destination is most popular for travel. As you can imagine, peak seasons lead to higher rates for flights and hotels. Once you decide on a destination, look up the peak seasons for that location and plan your trip around it if possible. Generally speaking, summer, holidays, and Spring Break are peak travel times. If your days are flexible, you are more likely to find a great deal on flights.

Join a loyalty program

Joining loyalty program is a great way to earn points towards your travel. There are many programs out there, from travel credit cards to hotel rewards programs. The common denominator is that you are rewarded for being a loyal member or for using your credit card for purchases. If you decide on a rewards credit card, be sure to still pay the balance off in full each month to avoid accumulating additional debt.

Cut your monthly bills

Review your monthly expenses and find ways to add more to your travel savings account. In order to plan a trip overseas that you may have always dreamed about, would you be willing to trade in your expensive cable bill for something like Netflix or Hulu? Making that simple switch could save up to $100/month. This would also be a great time to consider refinancing your car if your credit has increased. Average savings for customers who refinance with rateGenius save an average of $89/month. These two small changes could add $200+ to your savings account every month.

Visit a friend

Many of us have a friend that lives in a place we have never visited. Perhaps they just moved there, or you just haven’t been able to make the trip. These vacations are the easiest to plan since you only have to focus on airfare if you are able to spend a few nights with your friend. Also, having a city insider makes planning activities a breeze. They will know the hot spots and be able to tell you which tourist traps aren’t worth the money.

Which destinations are on your travel hot list this year? Let us know, and we can try to help you get there!

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5 Tips to Nail Your Yearly Budget

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When it comes to budgeting, planning ahead is the best way to guarantee success. If you have struggled with sticking to a budget in the past, these 5 tips may help you stay on top of it this year.

Write down every bill and expense

The easiest way to fail at budgeting is to forget an expense. When you forget to account for a bill and then try to make up for it by moving around other payments, you may end up far off your budget. Write everything down with the due dates before creating your budget.

Here are some things to remember:

  • Mortgage/Rent
  • Car Payment
  • Insurance
  • Electricity
  • Gas
  • Water
  • Toll or parking charges
  • Pet expenses
  • Gym memberships

Prepare in advance

Have you noticed that you are less likely to spend a lot of money on food if you prepare your lunch in advance? Meal prepping can save a lot of money over a year and minimizing eating out for dinner can also help save over the year. Think about better ways to use that money and plan your meals out for the week.

Also, set aside money for entertainment. If you know you will want to attend a party, concert, or movie, just plan the amount of money you will need and allocate your money towards that event. Denying yourself can lead to splurging later, and splurging leads to a failed budget.

Give yourself an allowance

Don’t deprive yourself. You are less likely to stick to your budget if you feel like you aren’t able to do anything you enjoy because of your budget. Therefore, you should give yourself an allowance every week to spend towards things you may want or need. How much should you give yourself? That depends on how much money you have left after all of your bills are paid, groceries are purchased, and your gas tank is full. For some people, $15-25/wk is sufficient, while others can afford to spend a little more.

Treat yourself for a job well done

After a few months of staying on track with your budget, allow yourself to purchase something nice. You can do this by saving your allowance over time, or gifting yourself with something after a bonus or successful month. It’s important to remember that you only have one life, and you should be enjoying it without constantly crunching numbers.

Set reasonable goals

There’s nothing wrong with trying to push yourself to save or payoff a debt as quickly as possible. However, there is something wrong when not meeting that goal causes you to lose hope and fall off the wagon. If you make a mistake and miss something on your budget, fix what you can and keep going. One missed payment should not mean that you stop trying. If you are not acclimated to budgeting, there may be a time or two where you miss something, prepare as much as you can, be also cut yourself a little slack. You are on the right track and that is all that matters.

What are your financial goals for this year? Share them with us!

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High Car Payment? Drop it In 2017!

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If you’re heading into the new year with a high car payment, drop it now! Lowering your car payment now allows you to restructure your budget before the year starts.

Refinance your car

Refinancing your car is the best option to lower your car payments if you want to keep your vehicle. If you don’t plan on trading in for a year or so, you can benefit from a refinance. Refinancing is easy. After a quick application, you will be contacted to start the process. Your existing loan will be paid off, and then your new loan will be established.

If you are looking to lower your monthly payment and extend the term of your loan, auto refinance will allow you to do that in order to lessen the burden of your monthly car payment. Additionally, if you spent too much on holiday shopping, refinancing could allow you to skip a payment, giving you some extra money at a time when several hundred dollars in your bank account can go a long way.

Anyone with an existing auto loan can apply to refinance anytime after they have purchased their vehicle. All you need is your personal, vehicle, and current loan information to fill out an online application.

Purchase a new car

With dealerships looking to clear their lots of 2016 models, this may be a good time to cash in on a new car deal. Additionally, dealerships will have to pay taxes on the vehicles left on their lots at the end of the year. Wondering the best time to buy? End of the month, end of the year, or end of the day. People report getting their best deals during these times. Good thing for you that we are approaching the end of the month and the end of the year.

Be sure to go into the dealership prepared to negotiate. You should know the value of your current vehicle before trading it in and it is a great idea to secure financing through your credit union beforehand.

Also, be sure that you’re negotiating on the full price of the vehicle, not your monthly payment. Otherwise, the salesperson will know what they can tack on to the price of the vehicle to reach the maximum you’re willing to pay for the car each month. If you’re trading in your vehicle, make sure that you know how much you can expect to receive for your trade-in so that you’re not surprised by their offer.

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