Prepare Thoroughly For Financial Security In Retirement

By: Jody Smith

The retirement process is a complicated one, and it's easy to run into serious difficulties. But it doesn't have to be this way. Thorough research beforehand can give you the tools you need to make good decisions. Don't expect to spend a weekend doing a little reading, though. This is the rest of your life you're dealing with.

Don't guess or leave things to chance. Get to know all of your legal documents, like pensions and insurance. Find out what earnings can be expected from the investments you've made. Get to know at what point you will be able to take money out of a tax-deferred savings plan so that you will incur no penalty.

Know what you will be expecting to spend. Make a budget and stick to it. A budget is necessary to assist you in taking into account all expected moneys that will be coming in and going out. It is recommended that people considering and planning for retirement seek professional advice.

The retirement process can be a safer experience if you seek professional advice to help you navigate your way through it. Talking with your employer, or hiring reputable financial advisors is warranted for such an important undertaking. This can aid in achieving a better understanding of what you can afford to spend in all areas so that your retirement savings will last. It will equip you to make the smartest choices as to which sources of retirement income should be the first money spent, so that the amount of taxes can be kept as low as possible.

Take care of as much of the debt you've accumulated as you can before you retire. Supplementation from part-time jobs can preserve your retirement savings to last longer for you. A reverse mortgage, if it's appropriate for your situation, can take some financial pressure off of your retirement income.

A study by Fidelity Investments reported on the things people who have retired most wish they had done differently. Creating a budget was number one on the list, for 21 percent of retirees who took part in the survey. Another 19 percent of those surveyed wish they'd created an asset allocation strategy. An asset allocation strategy is a plan for diversification of a fund or portfolio, possibly under the guidance of a money manager, making changes as your investment goals change.

For 18 percent of retirees surveyed, better development of an income source withdrawal strategy would have left them more financially secure. Another 19 percent wish they'd researched beforehand and had a better grasp of the payout options available for their 401(k) plans. Lastly, 17 percent wish they had chosen not to retire as early as they did.

According to the Fidelity Investments report, many people on the verge of retirement have not planned thoroughly, or have not taken some of the important steps toward a secure retirement. This study was reported upon in an article on About.com.

Jody Smith is a freelance writer for EmpowHER.com.

Sources:

What Recent Retirees Wish They Had (or Had Not) Done

http://seniorliving.about.com/od/manageyourmoney/a/retiresurvey.htm

Asset Allocation

http://financial-dictionary.thefreedictionary.com/Asset+Allocation

Protecting Your Retirement Dreams

http://seniors-site.com/blog/2011/07/protecting-your-retirement-dreams

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