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4 Ways To Prepare for Retirement

4 Ways To Prepare for Retirement

Retirement is something most people try to avoid thinking about. This seems strange, since retirement should be some of the most blissful and relaxing years in a person’s life.

The problem with retirement is that it takes years and years of financial planning to make sure that relaxation is actually an option. If planned incorrectly, retirement will instead be a miserable time period filled with fruitless job searches and financial stress.

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Luckily, it is never too late to start planning and figuring out what exactly needs to be done. Here are five ways people build steady retirement incomes that allow for safe and secure retirement.

1. Buy real estate

Real estate is an asset that typically goes up in value over time. Sure, there are ebbs and flows, and sometimes real estate will lose value for a few years, but in the long run it has always gone up. It is also expected to continue to do so for the foreseeable future. The world isn’t getting any bigger, and that means that land is becoming increasingly limited.

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Buying real estate for your retirement can be as easy as purchasing a home while you are young, or as complicated as going into a commercial venture with some business partners. Getting a home for yourself while you are young can allow you to stop throwing away money on rent and instead put that money to something you own. As long as you are planning on holding the home for the long haul, it is typically a good idea.

2. Fixed deposits

If you are a little closer to retirement and don’t want to risk your current retirement savings then you should look at something called fixed deposits. These are essentially savings accounts that give higher interest rates. You agree to leave the money in the account for a specified period of time, and the bank will agree to pay a higher interest rate than a typical savings account would get. Fixed deposits are similar to CDs.

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3. Start an IRA

Many people have heard of these and might consider them too complicated to try and set up. In today’s age that couldn’t be further from the truth. You can open up an IRA in a matter of seconds using just about any broker. There are some brokers coming out today called robo-advisors that will essentially make most investing decisions for you based on your current situation.

One of my favorites is called Motif Investing. They allow you to decide what industries you think will do well in the future, and they will find and make the investments for you.

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4. Start an online business

With the way the internet functions today, you can start an online business in just a few minutes. Many people do this because once the business is thriving and they are ready to retire, they can do so, and the business typically continues to thrive with little effort. You can sell physical products, or you can just become an affiliate of a few niche companies and then take a commission every time you refer a customer to them. Many people do this and are able to retire early with a consistent income.

The key to retirement is diversity. Do not rely on a single income source, or you will find yourself in trouble if that single source has issues. Be careful not to rely on the government too much, as policy is always changing, and you never know exactly how much you will really get. Many people believe that social security will take care of them, but current numbers point to a different story.

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Spencer Mecham

Personal Finance Coach, Digital Marketer

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Last Updated on April 3, 2019

How to Nix Your Credit Card Debt in Less Than 3 Years

How to Nix Your Credit Card Debt in Less Than 3 Years

Debt is never a fun thing to be in. But, there are many actions that you can take that will help you rid yourself of the burden of debt once and for all.

By coming up with a set plan, eliminating your debt can feel much easier than constantly thinking about it.

This post will provide some tips on how you can do this to help you nix your credit card debt in less than 3 years.

Hint: there are ways that are easier than you think.

1. Consider Consolidating Multiple Credit Cards If Possible

This may not be applicable to you, but if you have multiple cards – it is something to consider. Keeping up with multiple bills is time consuming.

It will depend on the balance you have on each. Consolidate ones you can but do not do it to the point that you get too close to the maximum limit. Also, it is ideal to pick the card with the lower interest rate.

Consider if there are any fees or alternatively, rewards, with transferring a balance to another card. Watch out for fees. Note that some cards offer rewards for transferring a balance to them. This is extra cash that can help go towards paying off your debt.

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Having one or two cards can make nixing your debt much simpler than keeping up with the balance of a bunch of cards. Keeping track of paying the minimum towards a bunch of cards is time consuming. Spend the time to consolidate instead to make the overall process simpler going forward.

My tip: Have one main credit card. Have a second one that you use for necessities – such as groceries or gas – that offers rewards for those purchases (a lot of cards do) and set the second one on auto-pay. You should be able to pay off a smaller amount on auto-pay if it is a necessity. If you think you cannot, then you may need to cut down a lot on expenses.

Why do I suggest doing this? Having one thing set to auto-pay is one less thing to think about. One less thing to waste time on. Same idea with consolidating to one main card. Tracking down too many is a hassle.

2. Try to Pay the Full Balance You Spent Each Month at the Very Least

You need to pay off the amount you are spending each month when that bill comes in. This is the amount you spent THAT month.

Do not let the debt keep accruing while you work on paying any unpaid debt that has accrued. It will become a never-ending battle. Try as best as you can to be current on paying for each month’s expenses when that month’s bill comes out.

If this is a strain, consider why. You may need to cut expenses. Or you may need to consider other cards. Or look at where this money is going.

3. Pay Extra When You Can – Every Small Amount Counts

This cannot be emphasized enough. If you are looking at a lot of credit card debt, it can look daunting, but each extra amount that you can put towards the debt will really add up – no matter how small it is.

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It does not just reduce the principal amount that you have left to pay off, but it reduces the amount that is collecting interest. You will always save money with that reduced interest.

4. Create a Plan on How to Pay Extra

Back to the main point, having this plan is giving you one less thing to think about.

This plan should be a plan that works for you. If it does not work for you, your spending habits, and your views on debt, then it will not be an effective plan.

For instance, if a set plan of an extra $50 (or another amount that you know you can afford) works for you, then do that. Set that aside every month and pay that extra amount. Treat it like a bill. Choose an amount that works for you and pay it like clockwork as though it was a bill you had to pay each month.

Little amounts will not nix it entirely, but they will help tackle it and having a set plan can make it less of a chore. Creating a new plan of how much to put towards it each month is an unnecessary added stress.

5. Cut out Costs for Services You Do Not Use

If you are signed up for subscriptions that you do not use because of some free trial or for some other reason, cut it out. Your overall financial position will look better.

In turn, that will make cutting your credit card debt easier. Look at your statements to find these expenses. If you do not use them, you may forget you are paying some unnecessary amount each month. Cutting it out can really add up in savings that you can put towards other needed expenses.

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6. Get Aggressive About It

Consider these points:

Depending on the interest and the level of debt, you may need to give up a few indulgences. For example, instead of ordering delivery or going out to eat, cook at home. Everything adds up.

Other things may be more of a sacrifice. It may be a trip you wanted to go on, or a daily latte habit you’ve picked up. In these instances, consider how important it is to you and if it’s worth the sacrifice. And if it is a costly expense, think whether you can wait to indulge.

Cutting an extravagant expense can really help make a dent in your overall debt. Try not to add to debt when you are trying to pay it off. It will be a never-ending battle. Make it less of a battle with these tips and it will feel easier.

Bottom line: Do what you can to make this process easier for you. Implement steps that do this. It takes time now, but will help overall. Also, keep track of your spending and paying down of your debts. Which is the next point.

7. Reevaluate Your Progress at Set Intervals

Doing a regular check-in can help you see your efforts pay off or maybe indicate that you need to give this a bit more effort. If you check every 3-6 months, it will not feel so much like a chore or feel so daunting.

By doing this, you will be able to better understand your progress and perhaps readjust your plan. Bonus: if you see it pay off, it will feel great to do this check-in. You will get there.

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Finally (and most importantly)…

8. Keep Trying

Do not get discouraged. Pushing it off will make it worse. Just keep trying.

Once your debt becomes lower, each monthly payment will reduce the balance more. Why? You are paying less towards interest. It will be a snowball effect eventually and it will become much easier to manage. Just get to that point. And know once you do, it will feel easier and motivating.

Start Knocking out Your Debt Today

The best way to eliminate debt is to get started right away. Begin by implementing the above steps and watch your debt just melt away. Try out some of the above strategies and see what works best for you. Soon you’ll be on your way to a debt free life.

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Featured photo credit: Pexels via pexels.com

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