singles-retirement

Can Singles Retire Successfully?

Several singles in their 20s and 30s tend to focus mainly on building their careers and lives that they don’t spare a thought for their retirement. However, the sooner you start planning for your golden years, the less time you’ll need to spend worrying about whether you’ll be able to relax a little after you retire or not.

As a single, there are steps you should take as soon as possible to prepare for this time of your life:

Start Saving as Much as Possible

One of the best steps you can take, as a single is to start saving as much as is allowed in your tax-deferred accounts each year. This may sound like a drastic move, but it’s important to keep in mind that you won’t have financial assistance from a spouse to help cover bills such as a mortgage, utilities and various other expenses.

It’s also crucial that you start building an emergency fund consisting of between three and six months of expenses because, again, you unfortunately don’t have the security of a partner’s savings or income if you are unable to work for an extended period of time for any reason.

Consider Creating a Second Income Stream

If you’ve noticed that you’re struggling to max out your tax-deferred accounts every year or there’s just not enough money to start building your emergency fund, it’s a good idea to think about taking on a second job temporarily – even if it’s part-time.

Taking on a temporary second job could be a financial lifesaver, especially if you have outstanding debts that need to be paid before retiring. After all, you wouldn’t want to be worrying about debt after you’ve stopped working and are living on limited income.

Financial Protection is Essential

As a single, you’re at more risk of financial ruin if you suddenly become disabled or too ill to work. For instance, If you had to find yourself in this situation in your 40s, you’d need to have some form of financial safeguard in place to be able to look after yourself through to your 70s or even 80s in some cases.

When purchasing any form of disability protection, it’s crucial to confirm that payouts will actually cover you for as long as is necessary because several of the cheaper policies in this category will often only pay out for a limited period of time. As such, it’s strongly recommended that you work alongside a qualified financial advisor when searching for this type of financial protection.

If you’re single, planning for your golden years need not be an overwhelming process – especially if you decide to take the above-mentioned steps as soon as possible. Spending wisely and investing appropriately while you’re still working will go a long way in helping to ensure that you’ll be able to enjoy retirement as much as you should.

Get in touch with our team of qualified and experienced financial advisors today to learn more about retiring successfully as a single.

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retirement-tips

Advantages of Downsizing before Retirement

Have you reached the stage of your life where you’re starting to think about or even look forward to retirement? If so, one of the best things you can do for yourself is to start downsizing your home and other aspects beforehand.

Here are just a few great reasons why:

Get Ahead with the De-cluttering Process

Part of the downsizing process is to determine which of your possessions you still need and which ones you no longer use or want. Although it may sometimes be difficult to let go of some items, doing so will allow you to be far more organized and keep your available space for the items you need and treasure the most.

De-cluttering will allow you to need less living space once you stop working, which leads to the next advantage.

Less Maintenance to Worry about

Your golden years are not the time where you should be worrying about how you’ll cover the cost of large home maintenance bills, a heavy mortgage and high utility accounts. Downsizing before you retire will allow you to determine just how much you’ll save on these essential expenses by moving into a smaller property, regardless of whether it’s in a dedicated retirement facility or not.

Fewer Monthly Bills

If your downsizing journey leads you to move into a dedicated senior living community, chances are that you’ll only be presented with a single monthly bill for the majority of your expenses. You’ll no longer have to worry about the added burden of yard maintenance bills or even property taxes because these are usually included in your monthly payment already.

Make Relocation Far Easier

After de-cluttering and keeping fewer possessions, you’ll find it easier to relocate than before – and possibly also have more choices regarding where you want to move to. For instance, if you’ve always wanted to move town or even to a different state, having fewer possessions and monthly commitments will make the process a lot easier for you. When searching, look for places that offer a low cost of living, decent healthcare and amenities that you’ll be able to take advantage of.

Focus on Enjoyable Activities

Downsizing before you officially retire will allow you to focus more on activities that you enjoy, such as hobbies, or even spending more quality time with your family if they’ll be living nearby. These days, retirement communities normally offer several different activities for residents to enjoy – with many of them being free or at very low cost.

Enjoy a Fresh Start

Instead of viewing your journey as just downsizing, think of it as an opportunity to enjoy a fresh start in life. Have you wanted to write a novel or engage in a new project, but not had enough time while you were working? Now will be the ideal time to tackle those goals because a lot of other responsibilities will now have been delegated elsewhere.

If you want to ensure that you’ll enjoy a financially comfortable retirement after downsizing, contact our professional advisors today.

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debt-consolidation-tips

Pros and Cons of Debt Consolidation Loans

If you’re dealing with multiple streams of consumer debt such as credit card, store accounts, personal loans or even outstanding medical bills, chances are that you may have considered applying for some form of debt consolidation loan at some point.

Obtaining any form of debt consolidation loan can make a lot of sense if it allows you to lower the interest rate that is being charged on the outstanding debts, but there may be some downfalls to obtaining this form of loan as well.

Pros

You Could Obtain Lower Interest Rates

One of the main advantages of debt consolidation loans is that it could allow you to repay what is owing at a lower interest rate, which could save thousands of dollars over the course of a year or two. If you’re fortunate enough to qualify for an interest free balance transfer credit card, you’d pay 0% interest for the entire promotion period – but a 3% to 5% transfer fee may sometimes apply.

Deal with One Monthly Payment

Instead of struggling to keep track of several different payments each month, consolidation loans allow you to combine all of your debts into a single payment with a fixed interest rate that won’t change over the life of the loan.

You Could Improve your Credit Score

Although applying for the consolidation loan will temporarily lower your credit score, making regular monthly payments towards it will help improve it again over time – often to a higher score than you had previously.

Cons

It Won’t Solve Financial Problems Over the Long Term

Opting for a debt consolidation loan doesn’t guarantee that you won’t accrue more consumer debt over time, especially if you have a history of living beyond your means. You will need to compile a strict budget and stick to it in the future if you intend changing your financial behavior for the better.

You Could Pay More Interest over Time

Regardless of whether you obtain a lower interest rate when consolidating your debts or not, you could still end up paying more in interest charges over time – especially if you’ll be repaying over a longer period of time. In some cases, debt consolidation loans can take as long as seven years to pay in full, so you must consider this before signing on the dotted line.

It Can Encourage Increased Spending

Paying off credit cards, store cards and other bills with a consolidation loan often creates an illusion for consumers to the point where they think they’ve got more money than they actually have. As such, you could find yourself in an even deeper hole of debt over time, especially if you aren’t willing to rein in your bad spending habits.

If you would like to learn more about compiling a realistic household budget that will allow you to keep up with expenses and even start saving towards your retirement, you can get started by chatting with one of our experienced financial advisors. Contact us today to set up an appointment.

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saving money

Can Lower Income Earners Still Save?

If you’re currently working and not earning a large paycheck, retirement will possibly be one of the last things you’re thinking about at the moment. After all, it’s challenging enough just covering your daily expenses – so how on earth are you still supposed to start saving for retirement?

Believe it or not, there are a few things you can do that will help you start saving for this time of your life – despite being a low-income earner:

Saving Money should be Sacrificial

Several financial experts agree that saving money is a process that should feel as though you’re making a sacrifice of sorts. If this is not the case, they claim that you simply aren’t saving enough. Your main goal should be to save enough money that it forces you to alter your spending patterns.

Instead of going out for pizza or ordering in over the weekend, set the funds aside that you would have used for this and try making your own pizzas at home instead. In most cases, it’s the small things you do that will make the most difference in the amount of money you can save over time.

Most Individuals Spend more than they Realize

Now is the time to start making notes of every penny you spend. Did you purchase a soda at lunchtime? Coffee on the way into work? Takeout on the way home after your shift?

Make a note of every purchase and keep record over the next 30 days, and then go back through your list and mark each frivolous purchase. Afterwards, add up the highlighted purchases – this amount could very well have been put into a 401(k) or IRA instead of being frittered away.

Although doing this will cause you to forfeit a few of those ‘nice little extras,’ remember that these funds could be earning you interest over the next few years.

Look for Ways to Earn More Money

These days, there are more ways than ever to pick up a little extra income on the side. Wherever possible, see if extra shifts are available at your current place of employment. If not, consider caring for your neighbor’s children when they go out for the evening, offer to run errands for a small fee or even check with friends and family about walking their dogs to try earn that little bit extra.

If you’re crafty, consider making items to sell at a local market – or even offer music lessons if you’re good at playing a specific instrument. These might not sound like ways to make a lot of extra cash at a time, but every bit will help. Save everything over and above your regular income, and you might find that planning for retirement isn’t as impossible as you think.

Although earning low wages can make it challenging to compile a retirement plan, it’s not impossible to do so. Tracking your spending, cutting expenses wherever possible and finding ways to bring in that little bit of extra money will go a long way in helping to plan ahead for your golden years.

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