By Jerry Mooney
Life is full of financial concerns and worries. No matter how hard you try, you can’t escape some money woes. One of the biggest of which is financing your retirement. It’s a hard job, and there are plenty of ways you can do things wrong. If you want to plan for your retirement, then you must avoid these three mistakes:
Leaving It Too Late
One of the worst mistakes to make is leaving things too late. You have to start saving as early as you can. It’s recommended that you plan for your retirement the moment you start earning money. The earlier you begin, the more financially secure you’ll be when you retire. A lot of people don’t start saving until they’re into their forties. Now, you still end up with a fair few years to save a decent amount of money for your retirement. However, imagine you were saving twenty years earlier, you could have so much more in your savings. It’s logical to plan from a young age; there are no negatives to doing this. As a result, you’ll feel more comfortable when you stop working. There’ll be a nice amount of money for you to depend on, and you won’t live a life of worry.
Depositing Money Into A Standard Savings Account
Many people think that setting up a savings account is easy. You go to your bank and open a standard savings account with them. The trouble is, this isn’t the best option for someone that’s funding their retirement. Regular savings accounts have their benefits, but you can get more worth out of an IRA. These are a different type of account, specifically for people saving for their retirement. The trick with these is that no tax is applied to your money when it’s deposited in there. As such, these tax benefits mean you can save a greater value of money over time. They’re easy to get sorted too, and most people hire an IRA custodian to look after the account for them. So, avoid saving via a standard account, and get more value from an IRA instead.
Not Having A Pension
A pension is an excellent way of financing your retirement. It acts as a replacement for your monthly wage. You’re used to working every day and getting paid a nice sum each month. When you stop working, this regular income ceases to exist. Without a pension, you’ll solely rely on your savings. Or, you’ll have to get a part-time job while you’re retired, which a lot of people don’t want to do. After all, the whole point of retirement to stop working! Not having a regular source of income can lead to financial instability. But, if you get a pension, then this doesn’t become an issue. You’ll get some money every month and can feel more secure. Pension plans are offered by the government, as well as some big businesses.
The reason these mistakes are made is because a lot of people lack the knowledge. Retirement is a massive thing, but we don’t take the time to learn more about it. Ensure you don’t make these mistakes, and you’ll be in a good place.
Jerry Mooney is co-founder and managing editor of Zenruption and the author of History Yoghurt and the Moon. He studied at the University of Munich and Lewis and Clark College where he received his BA in International Affairs and West European Studies. He has recently taught Language and Communications at a small, private college and owned various businesses, including an investment company. Jerry is committed to zenrupting the forces that block social, political and economic justice. He can also be found on Twitter @JerryMooney r