One might often think that once you reach retirement financial planning stops. Think again, frugal living and wise financial foresight can help ensure a comfortable life. Here are a few tips that will help you maintain stability for decades.
Determine Your Needs
Take some time to determine whether your current savings and lifestyle are sufficient for your future needs. For example, someone who chooses to begin receiving their Social Security benefits at the earliest age of 62, can expect his or her payment to be nearly a third less than someone who begins at the full retirement age of 66.
Understanding Your Retirement Accounts
Withdrawals from your 401(k) or traditional IRA are subject to income tax, while withdrawals from a Roth IRA are not. Ideally, you want to deplete your taxable accounts before any non-taxable accounts in order to maximize the effect of compound interest on your untaxed gains.
Balance Your Portfolio
Fidelity estimates that a 65 year old couple will incur $220,000 in medical expenses during retirement. When considering your portfolio, focusing less on specific equities and more on overall asset allocation is wise decision.
Life does not end at retirement and neither should your planning. How have you planned for your personal finances over the years? Leave us a comment below or on Facebook (click here)!