Whether we like it or not, the only way we can be stable financially is if we invest as well as save as much as possible. In other words, we need to keep our liabilities to the minimum and endeavour to save as much as we can. Excellent financial advisors opine that individuals should start saving for their retirement as soon as they land a stable job. You might think that you have all the time in the world but you will be surprised just how fast time flies. Saving money should therefore, be something that you teach yourself and commit to from the very first job you land.
Unfortunately, not many people take to savings from the very first time they land a job. A lot of people postpone saving for retirement and only wake up from their slumber when they have 10 or fewer years to their retirement. While a decade to your retirement is not sufficient to adequately prepare, it’s better late than never. If you are nearing retirement, the following tips or rather financial advice will go a long way in ensuring that you enjoy your sunset years with minimal stress.
Set up an emergency or reserves fund
Most financial advisors opine that you should have in your reserve or emergency fund a sum of money equal to 6 months of your current monthly salary. The reserve account should be easily accessible and safe. Remember that you won’t be privy to regular income in retirement and therefore it’s greatly recommended that you have enough in your reserve account to last you for a period not less than six months as you pull yourself together.
Start saving for your kids’ college
Remember that in your retirement you won’t be receiving a salary monthly and therefore it’s greatly recommended that you start saving for your kids’ college fees as early as possible. In fact, you need to start saving for your kids’ education from the moment they are born. The earlier the better. It will ensure that you have peace of mind in your retirement in the knowledge that your kids will go ahead with their education without having to worry about their fees.
Resolve loans, credit card bills or any outstanding debt you have
You definitely do not want to retire saddled with debt. You need to start as early as now before your retirement to resolve all debts as well as outstanding loans that you might have. Endeavour to reduce all credit card debts or rather eliminate all your loans to free up your income. As you near retirement, most of your income should go towards saving as opposed to paying off debts.
Have an effective retirement plan
Don’t just sit back and say that your pension from the government or company will be enough for you in your retirement. Work with your financial advisor for an appropriate retirement plan. Open an account specifically designed for your retirement. Deposit money in that account regularly and you can be sure that your retirement will be smooth sailing.