Although retirement may seem far away for some, it is always a good idea to start planning as early as possible. You work hard to provide for yourself and/or your family today, but how focused are you on providing for yourself 10, 20, 30 years or more from now?
Our family at Camino Federal Credit Union wants to make sure you and your family are prepared financially for life down the road. We’ve put together 5 of our best tips for you to consider!
1. Open a Retirement Account
It is never too early to start saving. If you can just put a little away each month or with each paycheck, you can really build up a nest egg for the future. The best way to do this is by opening a retirement account. Most people like to use a 401K or an IRA as a way to build their savings. To learn more in-depth about the benefits and differences of each, you can read this breakdown that we put together.
2. Consider Healthcare Plans
If you are fortunate enough to have health benefits from your employer, you and/or your family are covered today. When you retire, you might need a completely different plan based on your circumstances at the time. Understanding the current coverage you have now could benefit you in the future. For example, some unions and corporations have clauses that offer lifetime health benefits if you work a specific number of years for that company or in that union.
As healthcare is a major issue for Americans today, this is an area you shouldn’t overlook. If this isn’t an option for you, we recommend factoring the expenses of healthcare into your retirement plan in advance and knowing what your options are.
3. Calculate Your Fixed Expenses
This tip is more for people nearing retirement. What will your financial situation look like when you retire? You’ve probably done a good job budgeting for life up to this point, but you’ve likely had an income to rely on. Calculate what your monthly output could be during retirement for things like mortgage/rent, utilities, subscriptions, etc.
As with all budgets, determining what is a “need,” and what is a “want” is important. You may need to cut back or make changes to keep you on track financially.
4. Create Your Wanderlust List for Retirement
If you’ve developed a good nest egg (see step 1), you may spend your retirement comfortably. It will also allow you to do the things you may not have been able to do earlier in life, like travel or pick up a hobby.
What do you dream of doing when you retire? Is it traveling? Perhaps you’ve been interested in golf or buying that classic car? Depending on what your answer is, you might want to plan accordingly. If you want a lavish lifestyle, start saving for those golden years now.
5. Pay Off Debt
Debt is a growing crisis for Americans, and no generation is immune.
Business Insider recently partnered with Morning Consult about debt and the stress associated with it.
Of those that answered, more than half of all millennials and Gen X respondents said that they were stressed “some” or “a lot” about their credit card, personal loan, or student loan debts:
Of the 51.5% of millennials who have credit card debt, 67.4% are stressed
Of the 54.5% of Gen X who have credit card debt, 64.3% are stressed
Of the 24.3% of millennials who have personal loans, 62% are stressed
Of the 24.6% of Gen X who have personal loans, 62.5% are stressed
Gen X is most stressed about credit card debt, while millennials are most stressed about student-loan debt. If you can, avoid debt.
If you owe some money, consider a plan to eliminate it. Camino Federal Credit Union can help you create a plan for your future. You can talk to one of our Member Advisors by calling us at 800-835-3400. We are here to help you on your financial journey.