Learn Lessons the Current Retired People Learnt the Hard Way
There is little room for maneuver as you get older. As Retirement looms you may begin to realize that you have not made sufficient preparations. More and more people are continuing to work past retirement age but it is not always an option, certainly with an existing employer. Your Social Security Benefits are available at 62 but the figure you will receive is only 75% of what you would receive at the standard retirement age some time during your 67th year. Even then the average monthly figure based on the best 35 earning years you have will go nowhere near providing for comfortable retirement.
There is a bonus of around a further 30% for delaying your benefits until your 70th birthday but that will not be an option for those who have to finish working.
It is worth looking at what retired people are saying about their regrets after finding life difficult once their Regular Monthly Pay check stopped.
- They retired too early.
- They were too optimistic
- They took Social Security benefits too early.
- They simply didn’t prepare properly then found they were spending too much after they retired
Sometimes people have retired without using logic. N apparently significant fund may actually diminish far more quickly than they expect even if there is no apparent waste.
It is important not to take risks with finance in your retirement. Your fund will still earn interest by you have little scope for recovering from a setback. That means your investment strategy has to chance to more conservative products. It means some of your calculations are based on optimistic returns. The recession struck a fatal blow to portfolios that included anything that did not guarantee returns.
The temptation to take benefits at 62 is real. If it is out of necessity then they had no real strategy for the future; it was about living for the present. As retirees live longer problems were inevitable.
Preparations and Spending
It is difficult to resist the temptation to spend as soon as you retire. You now have plenty of free time on your hands. It can seem like a permanent holiday and many people spend more money on holiday than during a normal working week. There are obvious consequences for doing that.
Frankly there is no easy answer for people who have not prepared for their retirement beyond looking for ways to earn money and that means part time or even returning to full time employment. That is not always possible for health and practical reasons. Even when it is in the short term there will come a day when they are simply unable to work.
If you are reading this article and starting to worry then so you should worry. Whatever your age you should sit down and start to analyze your finances in detail. The younger you are the more chance you have of saving to create a significant retirement fund. In order to do that you should pay off expensive debt like that on credit cards. You are wasting money paying a high rate of interest on any balances you are carrying forward. You should negotiate a realistic credit loans which in today’s market will be at a much more competitive interest rate. Bad credit Loans are readily available for those in employment with a regular monthly pay check with the debt divided into equal monthly instalments over the term of the loan. At the same time you should prepare a proper budget and even do some research to see if you can save money on some of your regular bills such as utilities, telephone and insurance. There are comparative websites that will do many of the basic research for you.
A budget will not work without self-discipline and that means using a credit card only when you can pay off the transaction in full when the monthly end statement comes in. The incentive for doing this is clear in the stories that retired people have made about the mistakes they made leading up to and in the early years of retirement. After all you do not want to find yourself in the same situation do you?