Nearly every working adult dreams of a comfortable retirement. Yes, it will be great to finally be free to enjoy life.. One way to ensure you enjoy your retirement is to have enough money to take care of your bills. So, if you’re approaching retirement age, check on your financial numbers. This is to be sure you’ve considered all the factors. Do you have a plan that ensure you have the money you will need to maintain your current lifestyle? If your answer is NO, now is the time to put your finance in order. In this article, I will show you how to enjoy your retirement.
What Age Do You Want To Retire?
The starting point is to decide your retirement age. This is a question we all have to answer no matter how young we are. Answering this question helps to do determine how much you need to have in your retirement account. According to Canada Pension Plan, most people retire between age 60 and 70. The difference between what you need if you retire at age 60 and age 70 can be huge.
How Much Will You Need At Retirement?
The next step is to determine how much you will need at retirement. One easy way to know this is to look into your current lifestyle. You need to have clear picture of what your monthly expenses look like. If you don’t know this, you can start today. Start to create a money diary. A money diary will help you to understand what you spend money on now. Once you understand what your monthly expenses like, you can easily estimate how much you will need at retirement. Your ultimate goal should be to have enough money to be able to maintain your current lifestyle.
Consider Your Healthcare Needs
A person aged 65 to 69 spends an average of around $6,000 on their healthcare need. This amount can go as high as $12,000 for someone aged 75 to 79 and then skyrockets to close to $25,000 for someone aged 85 to 89. A greater percentage of this amount is normally covered by the Canada healthcare system depending on your province or territory. However, there are many other health related expenses not covered by the public system. This often catches retirees by surprise. It’s relatively easy to budget for housing, food, utilities, and other essentials, but medical care costs can vary widely and your actual expenses can be much higher or lower than average estimates. So, consider this carefully.
Build Your Retirement Fund
There are different ways to build your retirement. One way is to pay yourself first and put the money into a saving account. You just need to ensure that the interest you get plus the capital will be enough for you. You will find below some of the other things you need to do.
- Be Frugal in your spending: Your immediate focus should be to cut every waste, Refuse to spend money on what you don’t really need. Then, make a commitment to put that extra money away into a saving account. .
- Have a working budget: Create a personal budget and stick to it.
- Invest in what you know: If you want to increase your wealth, invest your money in what you know.
Finally, have a good strategy. This includes having a plan to have multiple streams if income. By creating multiple streams of income, you’ll be much better prepared for retirement. So, take time now to prepare now for your retirement. Once you retire, there might be fewer ways to earn additional income. Therefore, start today to prepare for your retirement.
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