Although financial advisors are often thought of as ‘costly money grabbers,’ the truth is that they possess the knowledge needed to help you plan ahead for your long-term financial goals. These specialists can analyze your current financial status and provide the information needed to plan for almost any life event such a buying a home or retiring. Below are some reasons why you should work with a financial advisor when planning for your retirement.
The Economy will Change
You may decide over time that you’d like to retire with an amount of $200,000 in savings. This is quite a reasonable goal for most individuals to achieve, but it will be necessary to take economic changes into account over time.
For instance, you may pay $3.50 for a gallon of milk at the moment, but how much will this price have increased by the time you’re ready to retire? The initial amount you had in mind for retirement may not last as long as you’d planned, which is why a financial advisor should be consulted when setting up a savings plan.
Anything can Happen
You may currently be in your late 20s or early 30s, have a good amount of money saved in a 401(k) and be working your dream job. While everything may be going well at the moment, anything can happen over time – you could get laid off (think COVID19 – no one expected to lose their jobs because of a pandemic during 2020) and end up needing money in a hurry.
Although it can be tempting to dip into your 401(k) account, this will not only cost you money in the form of early withdrawal penalties; you’ll be robbing yourself of potential retirement savings as well. A qualified financial advisor will be able to help you set up a practical savings plan to help deal with unexpected events like job loss or illness.
Health can Change Unexpectedly
While most individuals set up a concrete savings plan for retirement, it’s important to remember that a health crisis can occur at any time – leaving you in a financial bind. A professional financial advisor will be able to work with you to help allocate money for various needs, such as long-term health conditions. Even in the event of you not being able to work for an extended period of time, a reputable advisor will help you make the most of the money you already have.
Money Pits may need to be Identified
Several individuals earn enough to save and invest in retirement accounts, but tend to struggle with actually doing so. A financial advisor will be able to help you establish a practical budget to ensure that there’s enough money to invest each month.
For example, you may be eating out twice a week when it’s possible to prepare tastier meals at home. Although everyone deserves a treat once in a while, the bulk of what’s being spent on restaurant dining can be invested instead – even $100 extra that you save per month can make a substantial difference over the course of 20 years.
If you’re concerned about not having enough money to retire in the near future, get in touch with our advisors today. We look forward to getting your money work for you.Continue reading
Although you may not have started planning for retirement yet, or you’ve experienced personal circumstances that resulted in you delaying contributing to existing savings and retirement plans, this doesn’t mean that all is lost in this regard. In fact, there are a few financial new year’s resolutions you can make that will help get your savings plans right back on track again.
Enlist the Help of a Financial Adviser
If you aren’t working with an accredited and reputable financial adviser yet, now is the time to add this to your list of resolutions. Although retirement planning may seem relatively simple, the truth is that it can be quite complex – especially where tax laws and economic changes are concerned. Hiring a financial adviser will help ensure that you get your retirement planning on the right path from the beginning.
Find New Ways to Save Money
Although you may already have a 401(k) or some form of IRA account, you might find that you aren’t contributing as much as you want to them yet. If this is the case, start searching for ways to cut on expenses. For instance, could you get by with a cheaper phone or internet plan? (The answer to this in most cases would be yes). Are you paying for cable TV that you never watch? Even reducing the amount of times you purchase takeout in a month could make quite a big difference to the amount of money that you could be setting aside for retirement.
Start Contributing to Dedicated Retirement Plans
If you don’t have an IRA or 401(k) in place with your employer yet, be sure to get this started as soon as possible in the new year. These are by far the two best options when it comes to saving for retirement, so the sooner you can set them up, the better. Keep in mind as well that these contributions are pre-tax, meaning that you will probably not even notice these amounts being deducted from your paycheck at this time – but you’ll definitely notice the difference when it’s time to retire.
Repay Outstanding Debts
Your goal should be that you will be completely debt-free when you retire. Too many individuals make the mistake of thinking that there is still a lot of time to get their debts repaid, so they don’t treat them with any form of urgency. Unfortunately, this can result in them still having large mortgages to pay – while no longer earning a decent income. As a result, it’s strongly recommended that you start strategizing now to get all of your debt repaid as quickly as realistically possible.
Although everyone looks forward to the day that they will no longer need to report at the office, you will only be able to truly enjoy your golden years if you have planned ahead with regards to your finances. If you would like to find out more about hiring a financial adviser or setting financial goals, contact us today.Continue reading