What a great thing retirement plan can be, it says that someday you will be able to sit back and enjoy the fruits of your hard-earned cash and take some time to move at your own pace. But, what is this, you don’t feel you are actually ready for this big step even?
Well, have no fear your 60th birthday is a great time to begin this monumental stage of your life. This way you can get your affairs in order and have everything set for your 70th birthday. Following are some important “TO Dos” to squeeze in before this date.
1. Pick up your full employer match
If you have your employer on your 401k, this will be the best time to consider your personal input so that you can get the full match. If you don’t you need to think about the cash you are putting on the table that could be yours. These employer matches aren’t always the same and you will need to look into how this works for you. But basically, your employer may match 50% of the employee’s contribution up to 6%. So, if you contribute a whole 10% of your annual income, they will have to match it with another 5%.
2. Catch Up with Your Retirement Contributions
Once you turn 50 you can begin making additional contributions to your 401(k) or 403(b). And as of 2017 these can be as high as $6000.
3. Take time to review your personal disability quotient
It would be a shame to have your retirement planning altered by the inability to work, so consider your personal disability quotient, or PDQ. There is a free service that can help you figure out this important number. It will allow you to know the possibility of you needing disability insurance in your later years. Once you have a better opinion on the possibility you can make an informed decision about the need for disability insurance.
4. Consider working longer if you’re able to
There was a time where the popular thing to do was to retire at the age of 62 and take the social security check. But, you will receive an 8% return on the lifetime benefit of your social security with each year you keep on working. So, as you can see the advantage of waiting till you have reached the age of 70 is far better.
Working longer also allows you to store away a bit of extra cash for the retirement that is fast approaching.
Get Aggressive with that Mortgage
Eliminating the mortgage is a good way to begin your retirement with some extra spending power. There are many strategies that you can apply to this effort but here is one that was worked for those we help.
Set up a payment schedule on a biweekly basis. The final effect will 13 payments in 12 months and a few years shaved off the debt.
Find a Part-Time Job in Retirement
Just because you will retire soon doesn’t mean your days of active service are over and one. You can still take part in a part time position if you choose and this can help with the bills. You can boost your regular income and also find something to do that will keep you occupied at a relaxed pace.
In Conclusion –retirement planning is a big step toward the golden ages where you will want nothing more than peace and tranquility. Build for this important time today with clever financial retirement planning. If you would like more information on how to make this big change to your advantage, visit Vitalae & Associates LLC.