Just starting your retirement planning? Don’t worry. You have company. According to a recent study, nearly a third of Americans have no retirement savings, and an additional 22 percent have less than $10,000.1
No matter where you’re starting from, the simple act of developing a plan is always a step in the right direction. Your plan can help you track your progress toward your goal and help you make informed financial decisions along the way. Even if you’re getting a late start, you still have time to accumulate assets and live an enjoyable and comfortable retirement.
Every solid financial plan should be built on a foundation of solid financial habits. Retirement is a significant financial goal. You can put yourself in a better position to reach your goals by developing disciplined habits that will serve you throughout your life. Below are a few questions about your current approach to financial management. If you don’t know how to answer these questions, now may be the right time to meet with a financial professional and develop a new strategy.
Do you use a budget?
According to a study from U.S. Bank, nearly 60 percent of Americans don’t use a budget.2 That’s an unfortunate statistic considering that a budget is one of the most effective financial tools at your disposal.
You can use a budget to keep track of your spending, cut your expenses and save more money for retirement. It’s difficult to stick to a plan and meet your savings goals without knowing how much you spend and where your money goes. With a budget, you can identify areas where you’re overspending and then make the appropriate changes to your behavior.
There are plenty of apps, websites and computer programs you can use to create your budget. However, a simple spreadsheet is also effective. If you’re one of the 60 percent of Americans who don’t use a budget, now may be the time to make a change.
What’s your plan to increase your income and your ability to save?
Investing is an important part of any retirement strategy. Your investment portfolio can help you increase your assets and accumulate the funds you need to live your ideal retirement.
However, your most important investment could be in yourself. Your ability to save is dependent on your income. If you can increase your income throughout your career, you can also increase your savings capacity.
Consider ways you can improve your skills and advance your career. Could you further your education and earn a promotion? Could you learn new skills to make yourself more attractive to employers? Or is it time to consider a career change so you can elevate your earnings?
Your earnings drive your ability to save. Of course, as your income increases, it’s important that you allocate those additional funds to savings. If you simply spend the additional money, you won’t capture the benefit of your increased earnings.
Do you have too much exposure to risk?
Retirement planning is about accumulating assets, but it’s also about minimizing your exposure to risk. Any number of threats could derail your retirement plans. You could become disabled and have limited earning potential. You or your spouse could pass away unexpectedly, creating a financial crisis for the family. You could see a sizable downturn in the value of your investments. You might face a costly health care challenge that drains your savings.
Develop a retirement strategy that minimizes your exposure to these risks and others. Insurance is an effective risk management tool. You can use disability insurance to replace your income should you suffer a serious injury or illness. Life insurance can protect your family should you pass away. A financial professional can also help you find tools and strategies that reduce your exposure to market risk.
Ready to build your retirement strategy? Let’s talk about it. Contact us today at Stoll and Basler Financial Services. We can help you analyze your needs and implement a plan. Let’s connect soon and start the conversation.
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
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