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4 Proven Tips on How to Successfully Plan Your Retirement

4 Proven Tips on How to Successfully Plan Your Retirement

We all would like to have financial security in the future, but most of us aren’t taking the right path toward this goal. Planning for your future isn’t something that should be taken lightly. A financial literacy survey found that 40% of the American population will never make enough money to allow them to retire.

That’s a huge blow as this number is very high. Almost 50% of the population will most likely have to work for a life-long period in order to survive. With that being said, you have to take action so you don’t fall into this group of people. As a way to help you out, I’m going to share some proven tips with you to help you plan your financial’s future.

1. Use your money wisely.

As soon as you start working, you should plan how to utilize your money in the right manner. I know you may like buying beautiful things, but you should also put in your head that you’re making someone else wealthier as you’re lowering your saving. Assured Retirement Group states:

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Budgeting helps you manage your cash flow so that your income remains higher than your expenses.

However, I’m not claiming that you shouldn’t buy things you’re in need of, but you should be responsible as to how you’re spending your money. Buy things you need instead of buying those you want. There’s a big difference between these two. Once you start doing that you’ll be surprised to see how much money you’re actually saving which would’ve been gone down the drain.

2. Reduce your household costs.

If you’re about to be retired and no longer have the need for a big house because your children are all grown ups and out on their own, you’ll have to cut down on your housing costs. There’s no justification for spending money on something that’s not needed while you could be using that money for your much needed needs.

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Try to pay off all your debts or at least most of them if you can. Going into retirement debt free will definitely gives you peace of mind. Your retirement years should be the period of time where you’ll only have to enjoy the rest of your life. It shouldn’t be some additional years of you having to keep thinking about your expenses and debts.

3. Investing is far superior than saving.

It’s always a great idea to open a saving bank account; it gives you a form of a safe storage to put your money into. Though they claim that their customers earn interests on their saving, it’s really not significant if your account’s size isn’t a very large one.

Your best bet to make profits with your hard earned money is by investing. There are various ways you can take to invest your money. For example, you can buy stocks, you can open a small business, or you can open a CD account instead of a saving one. These are just a few options that you can take advantage of.

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4. Seek for professional help.

Oftentimes people are looking for suggestions to know whether or not they should start planning for retirement. In reality the earlier you can start the better it is for you. It would be in your advantage if you can start planning your retirement at a younger age, which would enable you to stop working before the average age.

If you’re interested to take the initial step and don’t know how to approach that, you can hire a Financial Advisor at a very reasonable cost to help you through.

Your current investments, Social Security benefits, or pension plans will play a huge role in this process if you’re not currently working. That’s because you’ll need a source of income in order to start planning your retirement. If you don’t have a source of income you can’t think about retirement.

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Overall

Many people won’t be able to afford going into retirement; however, it’s something that we all would like to achieve in our lifetime. If you’re working or if you have a source of income, you shouldn’t have any problem planning your retirement.

I’ve shared some proven tips with you throughout this blog post, taking some of them in consideration can take you a long way with your plan. Be smart about it; don’t wait the very last minute to start thinking about retirement. It just doesn’t work that way. Good luck with your plan, I’m hoping you have a successful retirement.

Featured photo credit: Travel Planet via travelplanet.in

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Published on September 17, 2018

How Being Smart With Your Money Leads to Financial Success

How Being Smart With Your Money Leads to Financial Success

Achieving financial success is not something that just happens. Maybe if you win the lottery or something, but for the average person like you or me, it comes from a series of small steps you take over a long period of time.

With each step, you form a new smart money habit. And with each smart money habit, you build towards financial independence.

So what sort of habits can you form to get on that path? Let’s take a look at smart money habits you can start today to get you closer to a financially independent future.

1. Avoid being “penny wise but pound foolish”

It’s tempting to try saving a couple cents here and there when buying small items. However, that’s not where the real money is saved. You’re putting in extra effort for something that doesn’t move the needle.

You get the most bang when you’re able to cut down on your bigger bills. For example, finding a lower interest rate for your mortgage could save you $50+ per month. And cutting your transportation bill by purchasing a cheaper car or taking public transportation can provide large gains as well.

So, look at your recurring expenses such as housing, transportation, and insurance, and see where there’s wiggle room. It’s a much better use of your time than trying to pinch pennies here and there on smaller purchases.

2. When you want something big, wait

Impulsivity can get you in trouble in most aspects of life. Finances are no different.

It’s human nature to see something and want it right then and there. It starts as a kid in the checkout line at the grocery store, and it continues on through adulthood.

We get an idea in our head of something we want, and it’s hard not to go out and get it right then.

A good example is wanting a new car. Perhaps you’ve had your car for several years. It’s crossed the 100k mile mark. Maybe maintenance is due, and you’re annoyed that you need to replace the timing belt or purchase new tires.

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So, you get the itch.

You start digging around online, and you realize you could trade in your current car for something newer and more exciting… all for a few hundred bucks a month. Then you get obsessed.

Here’s where you have to take a step back.

Your newfound obsession is clouding your judgement. Rather than giving into the impulse, wait it out.

Set a timeframe for yourself. Maybe you come back to the decision three months down the road. See if the obsession lasts.

It might, but often, a funny thing happens. Often, you forget about it. And often, you find that the new car wasn’t a need at all.

The impulse faded. And you just saved yourself a ton of money.

3. Live smaller than you can afford

You finally get that big raise. And you want to celebrate – and why not?

You’ve been looking forward to this forever. And after all, it was all due to your hard work.

That’s fine, splurge a little. However, make it a one-time deal and be done.

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Don’t get caught in the trap that just because you’re now making more money, you should spend more.

Too often, people get more money and feel like they that gives them the means to buy a bigger house, a bigger car… you know the drill. Resist.

The fact is that living smaller than what you can afford is one of the fastest ways to build savings.

But if you constantly upgrade as you begin to make more, then you’ll never get ahead. You’ll just build up more debt along the way and have just as little wiggle room as before.

4. Practice smart grocery shopping

Food… it’s one of the biggest portions of any budget. And if you’re not careful, it can be one of the biggest drains on your wallet.

But luckily, there are a few things you can do to ensure that you stay smart with your money when buying groceries.

Create a grocery budget

Set a strict weekly grocery budget. When you know how much you can spend on groceries, you can then plan your weekly menu around it.

Once you know what all you need, you can go shopping and keep a running tally as you shop to ensure you’re on track.

I tend to do this in my head, rounding for each item. However, writing it down as you go would probably work best for most people.

Make a list… and never deviate

Never go to the grocery store without a list. If you go to the store with a ballpark idea in mind, you don’t have a true ide of what you need.

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You’re not well-researched. You don’t know what the sales are. As a result, you’re going to make decisions on the fly.

These impulse decisions will lead to overspending, which will derail your grocery budget.

Eat before going grocery shopping

It’s also important to eat prior to going to the grocery store. Hunger is a powerful force.

If you’re shopping on an empty stomach, everything is going to look good. In particular, you may find a lot of ready-made, processed snacks will look enticing.

After all, you’re hungry now and that food is easily available. So subconsciously, you may lean towards those items.

Unfortunately, not only are those items typically less healthy, but they’re likely more expensive. You pay for convenience.

However, when you eat prior to shopping, then you’ll shop with a clear mind. Your hunger won’t cloud your judgement, influencing you to make poor decisions like a cartoon devil resting on your shoulder whispering in your ear.

This makes it much easier to stick to your grocery plan.

5. Cancel your gym membership

Now that you’re all set on your food, it’s time to get smart about managing your budget in terms of physical fitness. And let’s begin by avoiding the gym. The gym bill, that is.

The average gym membership costs around $60 per month. That’s $720 a year.

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Yet, two out of three gym memberships go unused. That means two-thirds of people who have a gym membership are literally giving away almost a thousand bucks a year. It’s crazy!

I recommend seeking an alternative. One good alternative is to look into fitness streaming services.

Streaming services allow you to stream hundreds of workouts like Insanity and p90x, right in your own home for around $10-20 a month. That’s $40-50 less a month than the average gym membership.

Of course, then there’s the free option. The internet is full of free workouts that you can do on your own with minimal or no equipment.

For example, there’s the Couch to 5K program, that I personally used a decade ago to ease myself from couch potato to running my first 5K race. If I could do it, anyone could.

Then there are free resources like reddit that have limitless information on workouts. The Fitness subreddit has done all the research for you, populating workout tips and detailed workout routines for anyone to use in their wiki.

There are several routines that require no equipment. And you can join in on the subreddit to become part of the community, making it easier for those seeking comraderie and encouragement in their fitness goals. All for free.

It’s baby steps… And baby steps can start now!

I’ve never met anyone that can’t stand to be a bit smarter with their money. And on the flip side, anyone can get smarter with their money. But remember, it doesn’t happen all at once.

Begin by fighting your impulses. Prepare for the week and be smart at the store. And cut monthly expenses like gym memberships that are overpriced and you probably aren’t getting your money’s worth out of anyway.

The devil is in the details. And the details can change your lifestyle and prep you for a financially independent future.

Featured photo credit: Unsplash via unsplash.com

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