A lot of people give little thought to retirement. This is not something you can jump right into. This, however, can be a huge mistake. If you want your retirement years to be pleasant, you need to get ready for them. Continue reading to learn how to go about doing that.

TIP! Don’t waste money on miscellaneous expenses. Make sure to fully list out everything that you spend on now, and be strong enough to decrease the amount of things you don’t really need to spend on.

Figure what your financial needs will be after retirement. Research has shown that most people need around 75% of their original income to continue being comfortable as they retire. People who already receive a low income may need around 90%.

Think about retiring part-time. If you cannot afford to retire fully, consider a partial retirement. You can either work a part time job or cut your hours at your current job. You can still have an income, relax a bit more, and transition to full retirement when you are ready.

TIP! Start a savings account while you’re young, and contribute to it regularly throughout life. Even small investments will accrue over time.

While you know you should save quite a bit of money to retire with, you also should be sure that you consider the kinds of investments that need to be made. Diversify your investment portfolio and don’t put all your money in one place. When you spread your money around into different types, you will be taking less risk.

Balance your saving portfolio quarterly. Doing so more often can make you emotionally vulnerable to market swings. If you do not balance your portfolio often, you may be missing out on great opportunities. Collaborate with a professional adviser to get the best results.


The belief is, once you retire, you’ll have the free time to do all the things you’ve dreamed about your entire life. However time seems to slip away faster and faster as years pass. Advance planning of daily activities is one way to organize your time.

What does your employer offer in terms of pension plans? Learn everything you can about it before you invest any money. If you are going to switch jobs, find out the status of your current pension plan. Hopefully, you will still be able to access certain benefits. You might also qualify for pension benefits through your spouse’s plan.

TIP! Take a good look at your employer’s retirement plan. Sign up for your 401(k) as soon as possible.

Set goals which are both short- and long-term. Goals are an important part of life, especially retirement. If you know the amount you need, then you’ll know the amount you must save. Some simple math can help you plan goals for this week, month or year.

Catch up contributions can be very beneficial for you. Typically, the yearly limit for an IRA contribution is 5500.00. The limit will increase to about $17,500 when you are over 50. This is great for those that started late but wish to save a lot.

TIP! Reduce your expenditures prior to retirement. You might feel as though you have planned well, but life is full of surprises.

When you calculate your needs, plan to live the same lifestyle. If this is the case, you can expect to live on roughly 80 percent of your current income since you will not have some work-related expenses. Make certain that you do not dive into your savings too quickly once you retire.

As you transition into retirement, look for friends who are at the same stage of life as you. Now that you have more free time, your social life will become more active. Retired friends will also want to do things that most people who are retirement age typically want to do. As an added bonus, there will people around you who understand you.

TIP! Think about a health plan for the long-term. Often, vision and other physical challenges arise with age.

Remember that Social Security payments will not cover all your living expenses. It will help, but won’t be enough to live on. You actually require 70-80 percent of your salary, though, if you want to enjoy your time in retirement.

When you retire, you can spend quality time with your grandkids. If your children are struggling with paying for childcare, you can help with taking care of the grandchildren. During those times, plan some activities that both you and your grand-kids will enjoy. Just don’t agree to watch the kids all the time. You do need time to yourself.

TIP! Look into the pension plans offered by your company. If you locate a good one, see if you qualify.

What level of income can you enjoy during retirement? Do you understand what benefits you will be entitled to and what income you can depend on? Your financial situation will be more secure when more sources of money are available. Do you have other income sources that you could consider that could still earn from after you’ve retired?

Try looking at a reverse mortgage. In this way, you can stay in your existing home and use funds built up in your home equity. The money doesn’t need to be repaid while you are living; the money will be returned from your estate once you die. This can be a great way to get some extra funds if you need them.

Social Security

Don’t rely solely on Social Security. It’s helpful, but not a huge amount of money. Social Security benefits will fund approximately 40 percent of your retirement needs.

TIP! Attempt to enter retirement free of debt. It is much easy to pay on your mortgage and your car loan when you have a full time job then when you are retired.

If have a special pastime, try to find a way to make it profitable. You could be creative and like to paint, sew, or do some woodwork. Enjoy working on projects during the winter and sell them at a summer flea market.

Have you invested in college tuition for your children? While that is certainly important, you need to get your retirement savings figured out first. Your kids may be able to do work study, get loans, or get scholarships. These may not be easily available after retirement, so try to always allocate your money wisely.

TIP! Don’t put all your eggs in the Social Security basket. Although SS payments may cover about 40 percent of the income you’ve been earning over the years, that usually doesn’t come close to the current cost of living.

Be sure that you have set up your power of attorney for your finances and for your health care when you retire. Those people will make health and financial decisions for you if you cannot do it yourself. Naming them means someone will take care of bills and your home, so your property remains safe.

Don’t allow yourself to fall for the misconception that retirement is simple. You need to prepare well for retirement. Now that you’ve read this article, keep learning more. Use this advice appropriately.