How can I guarantee a happy retirement?


At one point or another someday we will all retire. At least we hope we will. If you want to ensure that you have a happy and stress free retirement it is essential to start saving right away! With the magic of compound interest on your side, the earlier you begin to store away your loose change and extra cash, the more money your money will be making for you when you eventually get to those golden years.

It is important to understand how saving for retirement will affect you in later life. You and your partner need to have a serious talk about what your goals are for retirement, and from there you can make plans on how you can achieve those dreams. You need to come up with an idea of when you want to retire, what you want to do with your time after retirement (meaning do you want to travel abroad or just sit at home and read books, one requires a lot more money than the other!), and you need to discuss any other dreams you may have.

How much money should I be saving towards retirement?

As much as possible!! It is recommended that you save at least 8-10% of your salary in a retirement fund. If you can save more the better off you will be in the long run. If you are eligible to enroll in an employer sponsored retirement fund be sure to take advantage of that. Many times an employer will match up to a certain amount of your savings, which is free money so you better save at least that much!

When should I begin saving for retirement?

The sooner the better! With the power of compound interest it is important to start saving when you are young and you need to be aggressive if you want to retire early. If you start saving $4000 a year at 8% interest at age 22 you will have 1,000,000 by the time you are 62. If you wait to start saving another 10 years you will need to save more than double that every year to reach that million dollar mark by the age of 62. You need to start early so your money can make you money.

How should I diversify my funds?

For the best advice on this you should speak with a specialist who can take a look at your financial situation and compare that with your goals in life. Usually they say that the younger you are the more aggressive you should be. Of course, aggression means that you are taking on more risk in retirement terms. You will also speak with your advisor about how risk adverse you are, if you do not want any risk he will have you put your funds in a safe place where you will not earn as much interest as more aggressive funds, but you will not be taking the risk either. As you get older it is time to tune down the risk a bit. You do not have as much time in life to make up what you will lose in the case of a recession.

Speak with an advisor today to get some advice on how you should start preparing for your retirement, but remember the sooner the better!

This post was written by

jason – who has written posts on Budget Clowns.
Father of three and married to a lovely women. Always looking for ways to save money, and invest it properly for my children's future.

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