Showing posts with label retirement tax planning. Show all posts
Showing posts with label retirement tax planning. Show all posts

Wednesday, May 1, 2013

Living on a Budget after Retirement

Frugal living is not easy even if you have a job. There are so many things to think of, to budget and to decide. Most of the time, a regular wage is not enough to cover the expenses you need to settle monthly. In fact, it has now become a big challenge to live decently. How much more if you are nearing your retirement age? 

For some people, retirement is never an issue especially if they have ample savings for their future. But for the majority whose salaries are good enough to let them survive each month, life after retirement is still hazy. Does this sounds familiar? Well then, here are a few tips to help you get through your retirement and live a frugal life.

Plan Ahead Where to Retire

Before your retirement period, it is essential to plan things ahead. Decide where you want to spend your retirement. Do you want to stay in your home? Or, are you planning to move in another place where costs of living are lower? The cost of living in each state and city varies. For example, if you are living in a big city like NYC, obviously, you need to spend more. 

If you want to live on a budget after retirement, find an area with cheap cost of living than your current place. Some cities have lower property taxes and housing rates. In addition, these areas might have lower personal and sales taxes. One good example of city with low-cost of living is Austin, Texas. In this city, the costs of housing, food and transportation remain cheap in comparison to other cities. 

Live in a Smaller Home

If you used to live in a 5-bedroom house, it’s about time to reconsider letting it go. At this age, chances are, your children are grown up and have their own family. Staying in a big house with only two of you living will really make you feel empty. And this is even worse, if you are alone. Additionally, huge home requires more maintenance, which means more budget and work needed. 

Downsize your retirement home. Look for a smaller house or an apartment that can accommodate you (and your partner if you have). Smaller living space consumes less energy. And, less energy used means low utility bills. Thus, this enables you to save money and minimize expenses. Above all, the best thing about small home is less maintenance. 

Invest Only on Essential Things

After retirement, you might be tempted to buy anything that catches your attention with your retirement fee. Resist temptation! This will likely drain your finances in no time. If you want to buy something, make sure it is of great use and you really need it. Don't buy a brand new couch just because it has a very nice shade. If you really need it, go for it. But if it’s not necessary, do not spend your money. 

When it comes to your health, you should never be stingy. Investing in medical devices, like medical guardian, is essential if there is a need for you to have it. Health must not be neglected at this stage. The most important thing to keep in mind is to be wise. 

So, these are just some tips on how to live on a budget after retirement. Remember, planning is a vital element to have a successful retirement.

This article is by Ashley O’connor.

Wednesday, April 17, 2013

How to Plan a Financially Secure Retirement

saving and spending
saving and spending (Photo credit: 401(K) 2013)
You may think that you should only think about planning your retirement once you have plenty of funds saved and then and only then, seek financial advice. However, the most sensible way to approach it is to begin that planning process from your very first job. Don’t leave it until it is too late to save the money that you will need for retirement. 

Start Early

You don’t need the help of anyone in order to get started. You should start by saving a small amount of money a week and keep it in a savings account. Leave it to build up to a few thousand pounds. At this point, you can begin to invest the funds into the stock market. Ideally, you would invest in multiple diversified mutual funds, in addition to ETFs. Continue to save and invest until you have a nice little nest egg. Then you can begin to diversify further. 

Diversify Investments

To help in diversifying your savings, start to look at your portfolio as a whole and ensure that there is no single region, sector, industry or investment that is dominating your holdings. Essentially, ensure that you have investments in technology stocks, mature stocks, foreign companies, value stocks, growth stocks etc. To achieve this, begin to look through your mutual funds and note which company types and sectors are in each mutual fund. You should be reasonably diversified but this is nothing too much to worry about at this point. 
Focus on and take control of your retirement
Focus on and take control of your retirement (Photo credit: SalFalko)

When you have reached a significant amount of savings, you can diversify even more. You can then look to purchasing property. If you have the time on your hands, that is. Alternatively, you can buy real estate trusts or real estate fund in either residential or commercial properties. They can act as an effective diversification strategy from conventional assets, such as stocks or bonds. 

Build on Your Plan

Once your investment portfolio has grown, you need to be increasing your awareness of investing as well as the level at which you are planning for your retirement. Estimate how much you will need in order to retire and begin to work toward that goal.

One option you do have and should consider when planning your retirement is a payday loan from a company such as It may be that a member of your family is forced to have an operation or a loved one passes away. Such a measure should not be used for frivolous purposes but it can alleviate some of the stress that comes with retirement, just knowing that it exists as an option. 

As the time draws closer to your retirement, you will either feel secure or find that you are worried. If you are feeling nervous, it may be worth visiting a personal financial planner to assess your plan as it stands. They will be able to use sophisticated software in order to estimate the demands you are likely to be met with and calculate the odds of you running out of money. If you do feel secure then, by all means, enjoy your retirement!

Saturday, April 13, 2013

7 Habits of Highly Successful Retirees

retirement (Photo credit: 401(K) 2013)
Planning for your retirement is something that all of us know we must do, but many of us put this kind of planning off, we avoid it as we think we've got stacks of time to worry about it. However, if you wish to have a successful retirement, you must take the time to make plans to ensure that it is everything you desire.

There are seven things that every successful retiree did prior to retiring that has made their retirement happy and secure. Surprisingly, they are not all financially related. Most of these retirees stated the following seven habits as the key to their happy retirement.

1. Savings Accounts

You want to have a bank account set aside just for your retirement. While you are still working, only make deposits in this account. When you retire, use this account to manage your finances. By changing your accounts when you retire, you have mentally created a new way to approach your money. 

2. Have Investments

Take advantage of every investment opportunity you can afford while you are working to guarantee an income when you retire. Make sure that your investments are diverse, and if at all possible, make sure that they have low maintenance fees. You want to make sure that your investments are funding your retirement and not paying high commissions to the brokers. 

3. Pay off Bills

Try to eliminate as many bills as possible before your retirement date. Review your current bills to determine if there are ways you can reduce them, such as downsizing cable options, getting rid of a land line phone and only opting for cell service, and moving credit card debt to low interest cards. Debt free living helps reduce retirement stress.

4. Downsize Your Life

You have spent your entire life working, now it is time for enjoyment. Look for ways to reduce your obligations so that you can only concentrate on your passions. If you have club memberships that you are no longer interest in, get rid of them. If you want a smaller home with less yard work, look for a new home before retiring. Have a pro-active approach to making your life your own and not filled with chores and duties. 

5. Take Advantage of Senior Discounts

There are so many different senior discount programs available, including those for necessities such as insurance policies and utilities, that it is foolish not to use them to your advantage. So many people avoid the “stigma” of senior citizen. The truth is, you need to embrace this title and take advantage of everything that it offers. 

6. Make Plans for Fun

One of the hardest things that retirees must face is waking up in the morning with nothing planned. After a lifetime of getting up and going to work, adapting to not having to be somewhere each morning can be difficult. Successful retirees always make sure they have at least one thing planned each day so that they are never sitting around with nothing to do. 

7. Volunteer

Retirees that offer their services to local charities, even for a few hours a week, seem to be the most successful. There are so many opportunities, from mentoring children to advising business owners, to accepting tickets at the gate of a state park, that any retiree can find a volunteer position that makes them happy.

The tricks to a successful and happy retirement are not as hard as you may have thought. As you can see, it just takes a little planning and a desire to be happy that will make your retirement the best time of your life.

This article was written by Perth Financial Adviser, Medhat Takla from Chambers Investment Planners. You can catch Medhat on Google+ and LinkedIn as well.

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