According to financial planners, millions of Americans have “next to nothing in terms of savings for retirement”. However, these same planners also say that there are many possible ways to solve the problem of not being able to afford retirement. While the solutions may not always be ideal, they can improve the situation if retirement is truly your goal.
Adjust your monthly cash flow
Many wealth managers suggest rethinking your cash flow on a monthly basis. This could mean that you need to move somewhere where housing prices are lower so that you can cut those rental or mortgage fees down. Retiring the right way will require you to become serious about your strategic thinking. However, financial advisors at successful firms such as Blackrock say that going for higher rates of return by taking on riskier investments is not a good idea for retirement.
Increase your net savings
As painful as it might sound, this method is extremely effective. By spending less in the present, you will guarantee yourself more money when you want to retire. Although it may seem simple and obvious, it is overlooked by many of those who claim to be planning for retirement and is known to cause serious delays in the process. For those individuals who are in an extremely tight budgeting situation, this can have double the effect on your retirement fund. If you can successfully reduce your cost of living before retirement while simultaneously increasing your retirement investments, you may reach your goals twice as quickly and with double the funds.
Take advantage of social security
Most people looking to retire believe that there are few social security decisions we must make beyond whether to take out the money immediately as you retire, or to wait until times get rougher to do so. However, some may be surprised to learn that there over 70 ways to go about claiming this fund. It can be difficult for the average person to know which of the options are best for their plan to maximize the security pension they receive. When making these decisions, it is best to ask someone that is familiar with finance. This could be well worth it as the difference is often upwards of 100,000 dollars over the course of your life.
Prioritize getting out of debt
During the final years of someone’s working life, it is incredibly important to get out of debt. Planners warn that since the recovery from the financial crisis that more and more people are becoming comfortable with borrowing money again and that they should stay alert. If you still have a mortgage to pay off, or car bill to pay, prioritize these expenses before they drag on into your retirement years where your standard of living can be drastically reduced by debt over-hang.
It is probably the last thing many want to hear, but delaying your retirement by just a few years could be the difference between an easy or difficult next 20 years. Take your time, consult a financial advisor and air on the less risky side of planning your retirement.