Most of us wish we had started saving For Retirement sooner. But just because you're behind don't hold your head down.
I often meet with people who are starting to get close to retirement and realizing they are woefully underprepared. Either they didn’t save enough when they were younger, or they had an emergency come up, or they just didn’t worry about it until now.
If this sounds like you, don’t worry. All hope is not lost!
Tip #1: Pick An Aggression Level That Matches Your Journey To Retirement
What exactly does that mean?
You need to make sure that your retirement can actually handle your investment plan.
You may be able to be aggressive with your investments when you’re younger and have money to spare, but as you get closer to retirement, you should become more moderate and ease up to save yourself the loses.
More times than I can count, I’ve had people come into my office and tell me they want to be more aggressive with their investments to “make up for lost time”. Many even acknowledge that this comes with a risk, but they think they need to do it.
Absolutely not. The risks of aggressive investments outweigh the rewards.
The problem with this way of thinking is that it assumes the market is going to continue going up, but market volatility is real and it’s affecting a lot of people right now.
Getting a great return on your aggressive investments is not a guarantee and the potential loses could ruin your retirement.
Instead, figure out what level of level of aggression you can handle at your stage in your retirement planning and stick to it. That way, even if you lose money, you know your retirement will be safe.
Tip #2: Sit Down With An Expert On Retirement Income Planning
Okay, you may roll your eyes at me for recommending this, as I do income planning as well. We’d absolutely love to work with you, but there’s also tons of other firms that specialize in income planning.
Make sure you find a planner that understands the difference between how you invest and how you distribute your funds.
Investments grow your wealth, but as you get closer to retirement, things change. Making the most amount of money should not be the objective anymore. Instead, you should focus on how to make the money you’ve earned last.
For this reason, 401k's aren’t always the best plan, especially as you get closer to retirement. They grow your money, but it’s hard to use that income effective when you need it later on.
If you didn’t save as much as you would have liked in the past, this is doubly true. You don’t have time to save now, so you need to make sure every dollar you already have is maximized.
Find a planner that will help you structure your money so you get the highest distribution of income, not the highest amount of growth.
Tip #3: Be Willing To Change Your Expectations
As you get closer to your retirement, it’s important that you base your expectations on reality, not on what you want to hear.
To be blunt, if you haven't saved enough money, it doesn’t matter if you work with the greatest advisor and planner in the world, you still won’t have enough money.
This doesn’t mean that if you’re 58 and worried about your savings, that you won’t be able to retire at 65 if that’s what you really want to do. It may just mean that you adjust your expectations for retirement.
Maybe you don’t buy a new home at the beach and live like kings. Maybe you stay at the home you’ve already paid off and live comfortably.
If you’re really in a tight spot, consider working an extra two years.
It may sound like the worst thing in the world right now and it’s certainly not ideal, but be open to the suggestion. It will help you save more money and ensure you’re really in the place you want to be for retirement.
Come into your meeting with your planner humble and open to suggestions that they HAve. Be ready to say, “I don’t have a lot of money. what I can do to retire with peace of mind?”
Stop beating yourself up over the “Should”s and “Should have”s about your past.
it's Time to Focus on Building Your Future
You are where you are.
Focus on your future and figure out how to get where you need to be. If you’re lost or scared, you can always reach out to me through the link below. I’m happy to meet with you at absolutely no cost to look at your current savings and help you plan your income so you can meet the dreams you had for your retirement.