Young generations will need a completely new look at retirement, because we live longer and, with the constant prices growth, it’s quite clear that pension won’t be enough. So now is the best time to think about our future and start retirement planning.
The first thing to do it to ask yourself questions like how much money you need, whether you’re going to invest it, how much can you spend these days to make sure you have enough when you get older, etc. Also, think about how you want to spend your retirement years, as this will help with the choice of a date and a financial goal.
Here are some steps to make if you want to complete your retirement planning easily.
Step 1: Estimate
Estimate the date of your retirement and the amount of money you’ll need, calculate how much you have to make every month to be able to save and still live your life without strict limitations. There are a lot of tools online and apps for your phone to help you get all the numbers.
Of course, you never know what will happen in decades to come, what the level of inflation will be, what prices and fees to expect, etc. Some specialists recommend taking about 70-80% of your current spending as the base, but I think you should be more generous to yourself.
Step 2: Plan Your Savings
Divide the amount of money you got in your estimates by the number of years left to your potential retirement, and you’ll get how much you need to save in a year. If it’s easier for you to count on the monthly basis, you can calculate the necessary sum in the same way.
Now think about the ways to save money, because there are a lot. You can get a part-time job in addition to the main one to make sure you don’t restrict yourself too much. You can also invest the money, which is an amazing idea also if it’s difficult for you to maintain your savings. Another way is to deposit the money, but make sure you choose the right bank or firm for that.
Step 3: Keep Focus
It’s so easy to get carried away by your current life flow and forget about saving money for the future. Make sure you remind yourself of the goal you’ve set, learn about more ways to save money long-term, keep your health strong to live your life to the fullest as you retire. If economics change, recalculate your financial goals to ensure stable retirement.