Retirement Tips

Keen to Retire Earlier than Planned? Keep these Points in Mind

Most Americans dream of being able to retire early in a convenient and comfortable living environment, surrounded by those that they care about the most. However, with so many changes that have taken place over the past few years, retirement can seem further away than ever before for many people – and some may now even think that they’ll never be able to retire because of the lack of income after doing so. 

If you intend retiring earlier than usual with a decently sized nest egg, you’ll need to keep the advice below in mind:

Establish a Plan

Several working Americans completely forget to even think about retirement. Although you may have already set up your 401(k), you may not be taking full advantage of retirement savings options that are available to you. 

These days, several online retirement tools are available to help you determine where you are with your current savings plan, as well as how far you still have to go until you reach your goal of being financially comfortable during this time of your life. 

Start by establishing goals and familiarizing yourself with your company’s retirement plans and policies as soon as possible – you may find that they’re willing to make matching contributions, which technically equates to free money towards your retirement goals. 

If you’re feeling overwhelmed at the idea of trying to set up a financial plan for your retirement, don’t hesitate to et in touch with a professional advisor for assistance.

Consider your Position in Life

The approach you take towards planning for your retirement will largely depend on your current age, income, assets you own and the age you want to be when you stop working. For instance, if you’re in your 20s or 30s and want to retire at 55, you’ll need to make aggressive contributions towards a good retirement plan. 

If you’re closer to retirement age, it’s still not too late to start working on funding your retirement> making small adjustments such as directing funds into your IRA or reducing unnecessary expenses can have a tremendous impact on retirement savings – far more than you realize.

Think Positively about your Retirement

While it may seem scary to think about the time that you’ll no longer be working, retirement will be your ultimate goal if you intend relaxing and being as comfortable as possible during this part of your life. 

You should also be thinking of retirement as your end goal instead of something unknown. While it may be the time for you to reduce living expenses, it should also be the time of your life where you no longer have to stress over a job or income.

Don’t allow daily life and an overfull schedule let you forget about putting a practical retirement plan into place. Although determining what your expenses will be during retirement is a relatively simple process, you’re welcome to get in touch with one of our financial advisors if you require assistance in this regard. 

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retirement planning

Is it Possible to ‘Catch Up’ with Retirement Planning?

Are you in your 40s or 50s, concerned and thinking that it may be too late for you to start planning for your retirement? Although you may be getting a later than average start, this shouldn’t deter you from setting up a practical retirement plan. After all, starting late is better than not starting at all. 

Information on Forbes revealed that a mere 18% of American employees that are 55 or older have said that they’re highly confident that they’ll have enough money saved to retire comfortably. Just under 50% noted that they were ‘somewhat confident’ that they’d be able to afford to retire. 

If you’re concerned about not having a retirement plan yet, the tips below can help get you started with planning for this part of your life:

Reevaluate Any Existing Plans you may have

If you already have somewhat of a plan in place for how you’re going to afford retirement, now is the time to reevaluate it – especially if you haven’t paid much attention to it over the past few years. 

Start off by estimating your projected spending during retirement. How much will you need to live on each month? If you aren’t sure where to start or how to calculate the amount you’ll need to live on, it’s recommended to contact a reputable financial advisor for assistance.

Kids Moved Out? Start Saving Even More

After your kids have moved out of the house, you should be able to reallocate the funds you were spending on their needs towards your retirement savings. If you’re fortunate enough to still be earning the same as you were when your kids lived at home, you’ll find that it will be possible to save quite a large chunk of money from here on out.

Cut Spending wherever Possible before Retirement

As they enter their retirement years, a number of Americans adjust their lifestyles accordingly. For some, it may be aspects as simple as opting for cheaper cable, phone and internet plans – while others may have to consider more drastic measures like moving to cheaper cost of living areas. Anything that you intend changing during retirement can in fact be changed now, which will allow you to live more comfortably during your golden years.

Convert Monthly Installments to Savings

Have you recently paid the last installment on your car or mortgage? If so, don’t consider these amounts as extra spending money. Instead, transfer them directly into your retirement savings each month – and watch your portfolio start growing.

Take Advantage of Company Retirement and 401(k) Plans

When last did you transfer contributions to your company retirement fund or 401(k)? If these options are available, you should be taking full advantage of them because this will provide you with some extra cushioning in your retirement budget. Many companies make matching contributions to plans like these, so you shouldn’t let the opportunity of this free money go to waste. 

If you want to start making up for lost time with your retirement investing and aren’t sure how to begin, contact our financial advisors for assistance today. 

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debt free

How Impulse Spending will Derail your Retirement Plans

Regardless of how frugal a person may be, no one is totally immune to making impulse purchases from time to time. However, the more you give in to this, the more harm it will have on your finances – especially your retirement plans. 

Impulse spending is one of the most common barriers to achieving financial independence, so it’s crucial that you develop a strategy to help you overcome the compulsion to spend in this manner. Below are some tips to help overcome impulse buying.

  1. Calculate an Item’s Value in Time

Most impulse purchases are led by emotions, meaning that engaging the logical part of your brain will be the best way to stop it. An effective way to do this is to stop and think about the amount of time you would have to invest in order to earn what that specific item costs. 

For instance, if you earn $20 an hour after taxes and the item you want costs $300, you’ll have to work for 15 hours in order to afford it. Now, is that impulse purchase really worth 15 hours of your time? 

  1. Don’t Purchase Items that Cannot be Returned

In many cases, the most tempting purchases are those that cannot be returned if you change your mind – such as that final clearance item you’ve seen online or in-store and think the bargain is too good to pass up. There are usually good reasons for items going on clearance – they may not perform as advertised or in the case of clothing items, the fit may not be quite right. 

Most individuals have experienced the awful feeling of regretting a purchase that can’t be returned – at least buying an item that can be returned allows you to undo the damage to your finances once you realize you no longer want it. 

  1. Stop Shopping for Entertainment

If going to your local mall is your idea of entertainment, you’ll need to rethink how to spend your free time so that your financial situation can improve. 

When you put yourself into an area of temptation such as a mall, there’s a strong chance that you’ll make impulse purchases, so stay away wherever possible. Also, refrain from hanging out with friends or family members who shop for fun.

  1. Watch your Savings Grow

Once you stop giving in to impulse shopping, you’ll start seeing just how much money will be saved over time – funds that can be put towards your retirement or other investment accounts. Over time, this could amount to a few thousand dollars – which will have grown quite nicely by the time you reach retirement age.

Although it’s often tempting to spoil yourself with that little impulse purchase, this form of shopping becomes problematic when it starts affecting your finances. If you would like to find out more about how your savings can be put to work and grow as much as possible, get in touch with our financial advisors today. 

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Safeguarding your Health After Retirement

Just because you’ve retired, it doesn’t mean that you have to slow down your pace of life – and a recent study undertaken by the U.S. Centers for Disease Control has revealed that you shouldn’t, especially if you want to remain fit and healthy. The study further mentioned that older adults who remained in the workforce enjoyed better levels of health than those who didn’t, especially if the work they’re doing is physically demanding as well. 

While it may not always be possible to secure employment after retirement age, there are other steps you can take that will help keep you mentally and physically fit and healthy for as long as possible. 

  1. Get that Blood Pumping

Regardless of whether you choose to take to the tennis court, tackle a hiking trail or even play with your grandchildren at the park, you’ll be doing your body good. Engaging in physical activity helps keep promote good bone health, while also improving your balance and physical strength. You’ll also be at lower risk of developing heart disease, high blood pressure and cholesterol-related issues. Overall, a stronger body means that you’ll be at less risk of falling, which is one of the leading causes injuries in older adults. 

  1. Exercise Body and Mind Simultaneously

Other studies have noted that physical exercise goes a long way in helping to prevent dementia and Alzheimer’s, while other research has confirmed that physical exercise helps boost the immune system. Even engaging in slower-paced activities such as gardening and taking a gentle stroll around the block will be beneficial to your body and mind. Combining physical and mental activities will also improve muscle memory, cognitive acuity and balance. 

  1. Let your Creativity Loose

If you’re not able to secure employment after retiring, you can still keep your brain in shape by engaging in freeform and creative activities such as painting, quilting or any other craft you may enjoy. One study confirmed that older adults who engage in creative hobbies at least a few times a week were at far less risk of developing mental health conditions than those who didn’t. 

  1. Renew your Sense of Purpose

Do you enjoy caring for animals at your local rescue center, or preparing meals for those who are unable to cook for themselves? If so, keeping busy with activities like these could add years to your life – along with feeling a renewed sense of purpose in knowing that you’re doing something good for someone else. Studies have confirmed that older adults who mentored children experienced improved levels of mental and physical health, along with feelings of satisfaction.

Keeping busy both physically and mentally will be the best way to safeguard your health during your golden years – along with consuming a balanced diet. Scheduling regular health and wellness checkups and following your doctor’s advice in this regard will also go a long way in helping to detect any conditions that may arise as early as possible, which vastly improves your chances of recovery substantially as well. 

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budgeting tips

Recently Retired? Use these Budgeting Tips to Get Ahead in the New Year

Now that you’ve retired after working hard for the past few decades, you’ll want to spend some of your free time enjoying yourself as much as possible. However, it will now be more important than ever to create an effective retirement budget that will ensure that you don’t run out of money – especially if you know that you won’t be able to go back to work at any time. 

Below are some tips that will enable you to budget your retirement income as effectively as possible:

Know how much you’ll Need Each Month

Most individuals spend less after retiring than they did while working and financial experts suggest that expenses during this time of your life will be up to 20% less. For example, if you spent $2,000 while employed, chances are that your post-retirement budget will be approximately $1,600 per month. Keep in mind that this scenario is not absolute – some retirees will need to spend more than others. 

Determining how much you’ll need each month will involve making a list of all expenses such as rent/mortgage, property taxes, transportation, groceries, medical expenses, subscriptions and any other discretionary expenditure.

Shop around to Try and Reduce Regular Bills

If you’ve grown accustomed to using the same utility companies, cell service providers, insurance companies or any other providers that charge monthly rates, chances are that you may not be getting the best deals possible anymore. 

Nowadays, companies often change their offerings without informing existing customers. It’s recommended that you take some time to review all existing policies; subscriptions and recurring bills to see if any better rates can be negotiated – over time, this could reduce the amount of money you need to live on each month quite substantially.

Consider Moving to a Lower Cost of Living Area

The lower you can trim your monthly expenses, the further your retirement income will go – and one of the best ways to reduce the amount of money you need is to relocate to an area that’s more affordable to live in. Examples of states that offer lower costs of living include Ohio, Tennessee, Kentucky, Alabama, West Virginia, Missouri, Nevada and Indiana.

Downsize your Living Space

Regardless of whether you still carry a mortgage or not, holding on to the large family home where you raised your children may not make the most sense financially. It may be a good idea to sell up and purchase a smaller property that will be easier and more cost-effective to maintain. This will not only ease your budget; you’ll also be able to enjoy more free time because of having less maintenance and cleaning to do. 

It’s also important to remember that a lot of fun can be enjoyed for free or at very low cost when you’re a senior citizen. Community and senior centers often have several activities on the go, while museums and a number of other public entertainment venues offer steep discounts to older persons. 

If you would like advice regarding how to stretch your retirement income as much as possible without having to resort to drastic measures, contact our financial advisors today. 

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kids money

Kids Always Asking for Money? Here’s how they can Earn It

Does it seem like your kids are always asking for money to purchase the latest toys, games or other items their little hearts desire? While it may seem easier to just shell out the cash, this won’t teach them anything about managing their finances when they get older. 

One of the best lessons you can teach your children is that they will have to earn the money they need to buy the things they want – and the good news is that technology has made it easier than ever for kids to earn a few extra dollars to spend. 

Here are some kid-friendly income generating ideas you can present to your children the next time they ask you for a cash handout:

Start a Yard Service Business

Performing yard work is probably one of the oldest methods around that allows kids to earn their own money and it’s now possible for them to advertise their services online instead of trudging from door to door in your suburb to let neighbors know about their service offerings, such as raking leaves, mowing lawns, watering plants and doing general yard cleanups.

Dog Walking

With life becoming busier than ever for most adults, this doesn’t leave much time in their schedules for taking Fido out on a daily walk. Offering this service will not only allow your kids to earn some spending money; they will be getting a good amount of exercise and spending time with animals while out walking – a favorite activity for many children.

Teach Others how to Use Technology

Many older persons struggle to master using various gadgets and today’s kids are more tech-savvy than anyone else. If your child has a little patience and enjoys showing others how to use apps, set up their phone or computer or even navigate the internet, they could make a decent amount of money teaching older folk how to perform these tasks.

Organize other People’s Stuff

If your older child has a knack for keeping their own stuff well organized, they could put these skills to use for others and earn money doing so. A number of individuals simply don’t know where to start when it comes to getting their living spaces organized in a practical way, so they are normally more than willing to pay someone else to do it for them.

Run Errands

Older children are more than capable of running errands such as dropping off or collecting items at the post office, delivering and picking up dry cleaning and doing grocery shopping and delivering the goods afterwards. You may need to be willing to assist at times, such as when a particularly large grocery order needs to be dropped off at a neighbor though. 

Although the above-mentioned ideas will involve a fair amount of physical labor, they will also teach your child a valuable lesson in that hard work pays off. If they’re willing to put in the labor, they will quickly realize that it gives them some of the buying power that they so desire – especially as they become older. 


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Approaching Retirement on a Budget? How you can Keep Home Maintenance Costs Affordable

When questioned about where they want to live, a significant amount of those aged 65 and older state that they would prefer to stay in their own homes for as long as possible. This allows them to still remain a part of the activities in their communities that they have become accustomed to over the years.

However, living in your own home during your golden years can present some challenges, especially where property maintenance is concerned. You may be finding it difficult to climb ladders and change bulbs, clean gutters and perform other repairs – while also struggling to find reliable and reputable tradespeople or businesses to get the job done for you. 

Below are some available options for getting various types of maintenance performed in and around your home – allowing you to remain independent for as long as possible:

Seek Out Community Organizations

These days, many communities are served by various nonprofit organizations that can enable retirees to have home maintenance performed at extremely affordable rates – or even free of charge in some cases. Although organizations that offer these services will differ depending on the area you live in, one of the easiest ways to find out if any assistance is available is to visit your local senior center. Some libraries may have information in this regard as well.

Don’t Overlook Home Healthcare Providers

Many seniors already benefit from helpers or aides who come to their homes and assist with basic cleaning tasks such as vacuuming, dusting and general tidying up. Although these individuals usually won’t perform home repairs or general maintenance, there’s a strong chance that they will know of someone reliable and affordable that will be able to perform any repairs that may be needed.

Ask Family and Friends for Assistance

When any type of help is needed around the house, one of the best options for retirees is to consider asking friends and family if they will be able to help or whether they know of anyone else that can provide the assistance that’s needed. 

If you’re part of a religious community, you may find that youth groups and other volunteers will be more than willing to perform home repairs and other types of upkeep such as raking leaves, watering plants, trimming trees and shrubs or even applying a coat of paint in some cases. 

Retirees can also benefit from speaking with neighbors about any home maintenance needs they may have. Although the neighbors may not be able to perform the required tasks, they may know of reliable contractors who will be able to offer the best possible rates. 

While it may become more difficult for you to perform DIY and general home maintenance projects, help is often available out there. Most importantly, you should never be afraid to ask for help when it comes to taking care of your home – a number of individuals and organizations will usually be more willing to assist than you realize. 

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medical costs

Keeping Medical Costs as Affordable as Possible during Retirement

Many individuals are horrified to discover that healthcare will one of the largest expenses that they will have to take into consideration during what are supposed to be their golden years. Information provided by Fidelity Investments has revealed that a couple that retired in 2017 can expect to spend approximately $275,000 on healthcare-related expenses during retirement. 

Below are some strategies that could help minimize healthcare costs throughout this period in your life:

Prevention is Better than Cure

One of the best ways to avoid as many potential future costs, seek out ways to start improving your health and reducing the risk of disease now. Use spare time to exercise, get a good amount of sleep and ensure that you eat good quality food. Taking advantage of preventative healthcare services such as vaccines and free screenings that are offered from time to time will go a long way in helping to detect issues as early as possible.

Reduce Dental Expenses

A number of seniors are disappointed after learning that Medicare won’t cover the cost of most forms of dental care and procedures – which will be costly if dentures, bridges, crowns or implants are needed at any time. 

A great way to help reduce this expense is to see if you live near a dental school. Although students would be performing the procedures at these institutions, they will be under the close watch of qualified dental surgeons and using these services could slash your dental costs by as much as 50% to 60%.

Find Ways to Reduce the Cost of prescription Medications

Even retirees who have a Medicare Part D prescription drug plan will find themselves having to cover part or even all of the cost of some of the more expensive prescription medications out of their pockets. Sometimes, these plans have deductibles that will need to be met before the cost of prescriptions will be covered as well. 

Wherever possible, find out from your healthcare provider whether any generic alternatives are available for any costly medications that you’re using. In many cases, generic medications can cost up to 70% less than the originals.

Manage Existing Chronic Conditions

If you already have any chronic conditions such as diabetes, arthritis or asthma, now is the time to seek out ways to be proactive with regards to managing them. This can be done by learning as much as possible about each condition and doing everything you can to help prevent them from worsening over time. Your doctor or even a local senior center will often be able to provide the resources you need to get started with this. 

Although taking as many preventative measures as possible before retirement won’t guarantee that your medical expenses will remain low during this time of your life, it will certainly help knowing that you’re being as proactive as possible with regards to staying fit and healthy – especially if you commit to remaining physically and mentally active.

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debt free

How Being Debt Free will Benefit your Financial Future

Up to 75% of American families are carrying some form of consumer debt these days, making it fairly easy to think that this way of living is quite normal. While many households simply shrug off the fact that they owe money on multiple credit and/or store cards, the truth is that this behavior does have an effect on stress levels. 

Although it is possible for several families to adopt a debt-free lifestyle, it does require a high degree of self-control and financial discipline. Below are some ways in which living a debt-free life will benefit your finances now and in the future.

Less Stress

Knowing that you owe money on one or more store or credit cards and a vehicle causes untold amounts of anxiety in most people, which in turn can negatively affect your health over time. If you’re suddenly unable to make a payment on your vehicle, you stand a strong chance of losing it – along with all the money you’ve already paid towards its loan. 

Eliminating just your credit card debt and vehicle loans will go a long way in helping you to feel a tremendous sense of relief in knowing that your car cannot be repossessed due to non-payment, for instance.

Enjoy Increased Savings

Living debt-free not only relieves stress levels; it makes it easier for your household to save money as well. Money that would have initially been spent on credit or store card interest can be placed in a savings account instead, which can be used to build a decently sized emergency fund over time. If you already have an emergency fund, additional savings can be put towards other activities such as a vacation – or even starting to fund your retirement.

Have Funds to Invest

One of the biggest advantages of being debt free is that it will provide you with the ability to start investing money for your future. 

The earlier you can start investing towards your future, the more time compounding interest will have to help your money grow exponentially over time. This could even enable you to consider the option of early retirement in some cases.

Enjoy Financial Security

A lifestyle that’s free of consumer debt will go a long way in helping to increase your level of overall financial security. It means that you won’t have to constantly worry about debt hanging over you if you or your spouse unexpectedly loses a job or have work hours cut. If the worst happens and you become ill, having backup finances available will allow you to focus on recovery instead of finances as well. 

If you’re struggling to make ends meet because of having a lot of consumer debt, or you’d like to find out more about how you can manage your finances in such a way that you’d be able to save towards retirement, get in touch with our team today. We look forward to helping you create the most secure financial future possible. 

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Disadvantages of Continuing to Work After Retirement

More individuals than ever are choosing to delay their retirement and continue working after turning 65 and current statistics have revealed that up to 20% of men and women over this age are either still actively employed or seeking a position. 

While there are advantages to remaining employed during this time of your life, there are also a number of disadvantages that must be taken into consideration.

Working after Retirement can Affect Social Security Benefits

First and foremost, it’s crucial to keep in mind that working after turning 65 will usually have a negative effect on your Social Security and Medicare benefits. For instance, both of these benefits can be affected by the amount of income you earn after you’ve officially retired. 

If you’re receiving Social Security payments during 2021, you haven’t yet reached full retirement age and income from your post-retirement job exceeds $18,960, your benefit will be reduced by $1 for every $2 earned over this limit. However, once you officially reach full retirement age, you’ll be able to work without having your Social Security benefits reduced.

It’s Not a Guaranteed Solution for a Shortfall in Savings

Although continuing to work after officially retiring – even part-time – provides a good way to supplement any personal savings you may have, keep in mind that you won’t always be able to control your employment situation. For instance, if you become ill or are injured, you may have to stop working completely – regardless of whether you can afford to or not. As such, it’s crucial to prioritize retirement savings while you’re still young and healthy.

You’ll Have Less Time to do the Things you Enjoy

The most obvious disadvantage of continuing to work after turning 65 is that you will be left with less time than ever to do the things you enjoy – which is usually the main objective of retiring. However, this may not always be a serious issue if you happen to find a position that you enjoy.

You Could Experience Additional Stress

As most individuals become older, they look for ways to reduce the amount of stress in their lives – and going back to work will certainly not be the way to do this. This will be the time to consider the real reason why you’re returning to work – are you bored sitting at home day after day or do you truly need the extra money to cover unexpected medical bills? If you don’t really need to extra money, it may not be worthwhile to subject yourself to the unnecessary stress of going back to work. 

Although many new retirees feel compelled to remain as active as possible, it’s important to remember that this is the time of your life when you should seriously consider slowing down a little to enjoy your golden years as much as possible. If you truly are bored being at home day after day, consider donating some of your free time to a charity or other worthy cause that you feel strongly about. 

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