9 Tips for Planning Your Dream Retirement


Whether you’re 25 or 55, retirement planning can feel ominous and intimidating. As a 25-year-old, you probably felt like retirement was never going to arrive so there was no point in planning that far down the road. If you’re 55 years old, it can start to feel like it’s right around the corner and you still have a lot to do during that time. We have nine tips for you to help plan your dream retirement, other than putting money into a 401(k) or IRA every month because you should be doing that already if you’re planning on retiring.

Make a Plan

Planning your retirement means that you need to know what you want to do with your newfound time. If you’re planning to play 108 holes of golf each week, you need to budget your course membership or green fees. Many retirees travel for weeks at a time, but they have already planned for this and have the appropriate amount of money set aside.

Once you’ve decided what you want to do during your dream retirement, make a plan for your finances that will get you there. Know how much money you’re going to have to contribute to your savings each month to appropriately grow your nest egg to where it needs to be. You can speak with a financial advisor to learn more about how retirement savings works and the best way to maximize your contributions.

Get Started Right Away

You can never start saving for retirement too early. The sooner you get started, the more you can grow your savings and the less you will have to contribute over the years to reach your overall goals. If you happen to reach your goals early, there’s no harm in continuing to contribute. Maybe that means you’ll get to take that trip you’ve always wanted to Italy.

Get Out of Debt

Few things chew up your money faster than debt. Yes, you probably get to have a nice car or that boat you’ve always dreamed of, but you’re missing out on money that could be better spent on your future self. Make getting out of debt a priority in your plan for preparing for retirement and your nest egg will stretch much longer than you originally anticipated.

Meet Your Match

By this we mean, you should meet your employer’s 401(k) match. Right, we said contributing to a 401(k) wasn’t one of the tips. However, you do need to make sure that you’re maximizing your employer’s match. If you’re not, you’re missing out on free money. For instance, let’s say that your employer offers a 100% match up to 5% of your annual salary. If you’re making $60,000 each year, you’re paying $3,000 and your employer is also paying $3,000. That adds up quickly and can make for a significant portion of your retirement.

Get a Reverse Mortgage

If you’re close to retirement age and would like to get a large sum of money to help with your retirement fund, consider a reverse mortgage. This is where you take out a loan against the equity in your home and rather than paying back the loan each month, it’s not due until either you or your heirs sell the home.

Similar to a traditional mortgage, there are eligibility requirements that must be met to qualify. Most importantly of those requirements are that you must be at least 62 years old and have around 50% equity in your home. Additionally, your home must be your primary residence. You can learn more about reverse mortgage interest rates and eligibility by speaking with a lender like All Reverse Mortgage.

Forget About Social Security

Don’t plan on living off of Social Security. When you’re creating your retirement plan, it’s best to take Social Security funds out of the equation so that you can be more financially stable. Not only is there speculation that the Social Security fund will be completely depleted by 2035 but you might not be eligible to take enough money to live off it entirely. Plan your budget so that you don’t have to rely on that money at all and you can live more comfortably than you originally anticipated.

Stick to a Budget

When it comes to living your dream retirement, you will need to be strict with your money. This means sticking to your budget. Yes, your budget can include fun money or petty cash, but don’t overspend. You can easily nickel and dime yourself to going broke years before your retirement fund should run out.

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