The Essentials

There are countless strategies that to improve the quality of your retirement. However, there are some essentials to keep in mind as you approach and endeavor on your retirement. This is a time full of opportunities...here are some ideas to maximize your satisfaction.

Pump up your retirement savings by increasing your contributions to your 401(k). New contribution limits let you stash more dollars in your qualified plan than ever before. You find in the long run, you will not regret this.

Save automatically by setting up automatic deposits to a mutual fund or IRA. When you get a raise, consider directing all or part of it to your retirements savings. This will prevent the money ever from passing through your hands or your wallet, which will limit spending on extraneous things.

Take the time to think through your investment strategy. What will be the right investment mix for you once you are retired? What is your current investment mix? It never hurt to take the opportunity to rethink your financial strategies.

Review your life insurance coverage and consider long-term care protection. You may think it seems a long way off now, but preparing now could save you thousands later and give you the ability to choose your own care. This will ensure not only saved money, but saved stress on yourself and family members in the future.

Take this opportunity to be a little selfish. If you have the funds, go on a vacation or take a course you've always wanted. Sure, you can still help out with your grandchildren's college fund, but make sure there is a little left over for your own enjoyment.

Determine the impact of early retirement on your retirement benefits from your employer's plan. Learn the difference between taking out a lump sum payment and income for life. This is a situation where you might want professional advice.

Finally, don't let a new car or an extravagant vacation lure you off course. Make your retirement a priority before you get there, and you'll find that you will have more money to spend on all the things you want later in life. Waiting will pay off!

How to Afford a Second Home

Today, many Americans have the dream of having a home away from home. Last year, thanks to the aging baby boomers and tax code changes, second home sales made up almost a quarter of the residential real estate market.

The big question is "How can I afford a second home?" Downsizing is popular right now for baby boomers. With a pocket full of cash equity, many are selling their larger homes and purchasing a smaller home and a vacation house or investing in rental property. In 2004, almost 1/3 of residential property buyers who financed were using money from the sale of a primary residence, according to a survey by the National Association of Realtors.

Today the larger down payments and higher interest rates have been erased thanks to competition. Some lenders may still charge a little because of the risk in a home that is not constantly monitored by the owner. Of course, when financing a second home, you must make enough income to cover both of your principal residence and your vacation house.

Listed below are some tips for financing a second home:

Identify your primary goal. Why do you want a second home?

Apply for financing in the town where you are looking to buy. Bankers may give better terms because of the market.

Caution: You will be paying two of everything! Budget wisely!

Don't hurt yourself financially. Remember the reason you are purchasing a second home is for relaxation. You do not need money troubles to stress you out.

Carefully check out Internet loan sites.

Many people will purchase a vacation home together with family or friends. A big issue here would be the availability of the house. There are many ways to divide the time up, so don't let that be a big influence on whether to purchase your dream home. The important thing is to make sure you put everything on paper. Make contracts to cover the finances, maintenance and even how the house will be shared. Set up a calendar and mark everyone's vacation time down, therefore you won't have surprise visitors.

With a little extra planning, your dream of a home away from home can become reality!