How much money you should save by the time you retire?
Most of us don’t have an answer to this.
Quite unfortunately, if you don’t know how much you need to save for retirement and how, you run the risk of working a significant part of your life.
Experts suggest, you need 25 times the annual spending when you retire.
Let us face the trouble now.
With so many priorities, planning and saving for retirement is far from being a cakewalk.
We know that we need to save, but we do not know how much.
Planning for retirement need not be daunting.
You can do a number of things to make your retirement easier.
Start Saving Early
Start saving as early as you can.
Starting early will help you a lot.
Procrastinating is easy and there are significant chances to push back retirement planning when you have so many priorities, but it can have significant impact.
Now you have an estimate of the amount you need to save for retirement, start saving. Though beginning early can help, if you have not yet started, start right now.
It is never too late to start.
Cut Down Living Cost
Cost of living is one of the prime reasons people fail to save for retirement.
Tackling everyday expenses is tough, but that need not spell disaster on retirement!
You can stay on track by choosing not to spend your raises and sticking to your monthly budget.
Invest in Real Estate
To create a steady income stream, lease your property.
This will help earn a rental yield. Your rental income will be high if you have multiple assets. In fact, a number of seniors lease out residence, moving into senior care community. As rents increase every year, this type of income will help you remain ahead even in inflation. Thus, it is good to invest in property when you are young. Moreover, you can also sell off your asset in an emergency.
Set Up Automatic Recurring Deposits
The financial advisors recommend setting up the automatic recurring deposits. This will not just save the trouble of buying investments every week or month, but will also prevent you from spending the money you would rather save.
Do Not Over Spend on Non-Essentials
Going out to have lunch or signing up for the channels you do not watch will not take you anywhere. We understand that you want to enjoy life and have fun but it is certainly not advisable to allow that to hijack your future. By ditching a magazine subscription or extracurricular activities your kids do not enjoy, believe me, you can add a lot to your retirement account.
Even if you are not in the right position with savings, there are always chances to catch up and save more. Never feel afraid when it comes to asking for help. Your financial advisor will not just help you review current savings, but will also create a long-term plan for you.