Saving for retirement can be a headache. People don't know where to begin and how much to save. There are steps you can take to ensure you are saving enough for your lifestyle and goals for retirement. Here are some 7 tips for saving for retirement.
1. Delay retirement. This means more time to save and invest. Usually if you wait longer to claim your benefits, the monthly payments will be bigger up until age 70. Those who wait to claim benefits get 76 percent more per month than they would if they began claiming benefits around age 60. With that being said, also wait later to draw your social security benefits. No one knows when they will die. You should always be prepared to live as long as possible.
2. People are living longer now which means you will be living a long time after retiring as well. Many people are working part time to put off tapping into their retirement savings. People also start their own businesses or freelance work.
3. Buy an immediate annuity. Immediate annuities mean you pay a lump sum of money to an insurer in return for guaranteed regular payments for a period of time.
4. Relocate to a more affordable area. Downsizing to a cheaper area can help you with your retirement savings.
5. Plan out how much to save for retirement. Make a list of your financial priorities for the next few years, figure out your individual needs and goals that will help you live comfortably during retirement.
6. Pay off debt sooner, rather than later. Debt build up can use a bulk of your retirement savings if you don’t pay it off as you go.
7. Switch from a Traditional to a Roth IRA. Choosing the Roth IRA means tax free withdrawals.
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