| Retirement Planning - Is It Too Late |
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No one really enjoys talking about retirement planning simply because we need to finally admit we are indeed going to be old someday. It's like planning for a funeral and buying life insurance. Discussing old age and our inevitable mortality is never going to be a hit at cocktail parties.
No one really enjoys talking about retirement planning simply because we need to finally admit we are indeed going to be old someday. It's like planning for a funeral and buying life insurance. Discussing old age and our inevitable mortality is never going to be a hit at cocktail parties. Unfortunately, retirement will be a reality for each of us whether we are prepared or not. And, when we each get to the later part of our life, retirement might even mean an entirely different thing. If there's no more Social Security, and we will need to be totally self reliant, how do you plan on doing that? Taking inflation into account, it's not unreasonable to think that a tiny apartment in a bad section of town with rats and rodents would be over $20,000 or a trip to Starbucks could run about $100 for a tall latte. Planning can consist of a wide variety of methods, not only genuine tax exempt retirement accounts. Although 401s and IRAs are certainly a viable way to start saving for the inevitable, anyone who has any of these accounts now is aware that in critical economic downturns, a major portion of our retirement accounts can disappear literally overnight. Relying completely on this type of savings isn't your best bet. Yes, IRAs and 401s are the usual method used by most everyone who is interested in saving for retirement. They provide some nice tax benefits but also heavy penalties if we dig in before age 59 1/2. Many investors have seen their retirement accounts almost wiped out, just as they were planning on an exact retirement date. Don't go this alone. Find a licensed financial expert to give you advice on how to properly build a well balanced portfolio. It should contain some aggressive funds, some moderate funds, and some conservative investments as well. Learn how to adjust the balance of these funds during severe market fluctuations to help minimize your losses. The sooner you start, the better. Most financial planners can pull out a calculator and scare you just by showing you how much you'll need to save monthly in order to retire. After the age of 40, it's over a million dollars a month! Along with these retirement accounts, it's always a good idea to have an emergency fund you can have immediate access to with no penalties. You should add to this regularly. Even if this account gives you a tiny amount in interest, you at least won't be a in a position where the account value will be affected by the market. In other words, it won't decrease like your IRAs, etc. DISCLAIMER: This article is provided as information only and is not to be taken as financial advice. Retirement planning is something that is usually put off until it's actually impossible to start saving enough for a comfortable retirement. Get the best inside scoop on planning for retirement and investing for retirement . |