Getting Prepared to Retire

It is never too early to start thinking and preparing for retirement. Here are some items to consider about this very important time in your life.

Review your finances. Knowing where you stand will help you focus on where you are headed. If you are in debt up to your elbows, then obviously you are not prepared to retire. Right now, set a personal budget and include some amount for retirement. To keep the same standard of living after retirement, then you will need between 70% and 90% of your current income.

Review your current needs and goals. Knowing what you plan to do can give you some idea of what you will need in terms of money and health. So whether you plan to travel or stay home with the grandkids, start planning now.

Develop a healthy lifestyle. This is the perfect time to quit smoking and start exercising. Losing a few pounds can help many aging folks stay healthier and keep fitter.

Talk to your employer about your retirement plan now. Check to see what you can contribute and if your employer provides matching funds.

Discuss various retirement possibilities with your spouse. Understand each other's plans and make sure that you have all appropriate legal papers signed.

Review your benefits and social security statement. If you have any questions, call to have them explained now instead of later.

Open an IRA. You can check with your bank to see if you are eligible to open an IRA and get help you with the process.

Think of how you want to spend your time. After retirement, you may want to take another job, volunteer, travel, or hobby.

These tips on getting prepared won't guarantee that you'll be ready for retirement, but give you some suggestions on making it easier. Many great successes in life found their true calling after age 60! Retirement could indeed be one of the best and most productive phases of your life.

Common Retirement Mistakes

Many folks try to save money for retirement, but make little financial mistakes along the way that can hit hard when they least expect it.

One way to ensure you have enough to live on after retirement is to invest as much money into your company's retirement plan as you can afford. If money is tight, try to at least invest enough to get your company's matching funds.

Once you invest this money into a retirement plan, don't withdraw it! The temptation will be there now and again, believe me! But if you do withdraw money, you will lose valuable interest that will be very hard to replace. Even though some plans allow for the loans, try to avoid this, because you will face penalties or an early withdrawal fees.

After investing, don't just sit back on your laurels and hope for the best. You must monitor your investments so you can be aware of any discrepancies. If you are carefully tracking your investments, then you will know when to change strategies.

A big mistake people are facing now is simply relying rely on social security to supply the income. Social security will more than likely provide a large portion of your income, but you should always have a back-up plan. The best back-up plan includes: a company pension or retirement plan and a personal savings. You should never rely on your spouse's retirement plan. If your spouse should die or divorce you, then you will be left without any income. Each person must have a separate plan for the best security.

Here is a question you need to ask yourself, "Am I taking my retirement planning seriously?" By starting early, you will grow a large nest egg and may actually be able to retire early. People make the mistake of thinking they have plenty of time to plan for the future. Right now is the perfect time to speak to a broker or financial advisor and start saving today.

Do remember it is your money, don't trust just anyone with it. Check out the advisors credentials and track records. Don't put all your investments in one stock, but diversify so that if one drops in value the others may increase. Also if investing in one stock, you take that chance of the company filing bankruptcy and losing it all.

A few minutes a month watching over that growing nest egg isn't too much to ask, now, is it? Not when you consider the benefits! Take care of your money now, and it will take care of you in the future.